COMPANY AND BUSINESS OVERVIEW

The Company is a Non-Banking Financial Company
(“NBFC”) offering a diversified suite of 13 (thirteen)
loan products, catering to diverse borrower segments,
including salaried and self-employed individuals,
professionals from diverse backgrounds, students,
micro, small and medium enterprises (“MSMEs”) and
mid-sized corporates.

The Company commenced its lending operations in
1989 and has a customer base of over twenty two
lakh customers, as of March 31, 2026.

Following its acquisition by Rising Sun Holdings
Private Limited, a member of the Cyrus Poonawalla
Group, in May 2021, the Company has undertaken
several strategic initiatives. These include refined
product suite, introduced new products, embedded
a credit by design “risk-first” approach, invested in
its distribution network, technology and artificial
intelligence (“AI”) initiatives, established an
organizational structure with a multi-tiered leadership
team and scaled its assets under management
("AUM") while maintaining asset quality.

The Company's product portfolio comprises loan
against property, instant consumer loans, mid¬
market loans, business loans, pre-owned car loans,
prime personal loans, gold loans, education loans,
professional loans, consumer durable loans, machinery
and medical equipment loans, commercial vehicle
loans and shopkeeper loans. The AUM for newly
introduced products comprising prime personal loan,
gold loans, education loans, consumer durable loans,
commercial vehicles loans and shopkeeper loans was
H 8,298 Crores, 14% of our AUM, as of March 31, 2026.
The Company maintained a balanced mix of secured
and unsecured lending, with 54% and 46% of our
onbook AUM categorized as secured and unsecured
lending as of March 31, 2026, respectively.

Our credit-by-design framework embeds a “risk-
first” culture and disciplined risk management
across the lending cycle. The Company prioritizes risk
management and asset quality to pursue growth that
is sustainable, predictable and productive, consistent
with its risk management framework.

The Company operates a ‘phygital' distribution
network that integrates physical and digital channels
to reach a wider set of customers, increase operational
efficiency and reduce costs. The Company has an
extensive physical distribution channel comprising
504 branches across 20 states and union territories,
over 2,700 Channel Partners, over 12,500 dealers
(including retailers and original equipment
manufacturers), over 500 counsellor partners and 6
call centers, as of March 31, 2026.

Operations are underpinned by advanced
technological and AI systems integrated into our
platform, which span across the lending cycle. Digital
and analytics form the core of our technology AI
capabilities and enable us to enhance revenue streams
and drive productivity to optimize our operating and
credit costs.

The Company is led by an experienced management
team, with key managerial personnel ("KMP") and
senior management personnel ("SMP") possessing
extensive and diverse experience in the financial
service industries. The management team is guided
by the Board of Directors of the Company (“Board of
Directors” or “Board”).

The Company operates with a robust risk
management framework grounded in a credit-
by-design, “risk-first” philosophy. It prioritizes risk
management and asset quality to pursue growth
that is sustainable, predictable and disciplined.
The framework spans the entire lending lifecycle,
including prospecting, underwriting, portfolio
monitoring, collections, fraud risk, information
security and compliance, thereby strengthening
our risk management framework and supporting
disciplined, scalable growth.

FINANCIAL PERFORMANCE AND STATE OF
THE COMPANY’S AFFAIRS:

Financial performance:

Your Company has delivered strong financial
performance marked by growth, robust capitalization
and resilient asset quality. Our AUM grew to
H 60,348 as of March 31, 2026. Total Income grew to
H 6795.65 Crore for the year ended March 31, 2026.
Capital position remains robust with a CRAR, above
the regulatory requirement of 15.00%. Asset quality
remains resilient with Gross NPA of 1.44% and Net
NPA of 0.74% as of March 31, 2026, supported by a
provision coverage ratio of 49.00%.

Total Income on a standalone basis increased to
H 6,795.65 Crore in FY 2025-26 from H 4,222.84 Crore
in FY 2024-25 reflecting strong business growth

across all retail products. Net Interest Income (NII),
including the fees and other income continues to
grow healthy and on a standalone basis increased to
H 4028.98 Crore in FY 2025-26 from H 2,707.75
Crore in FY 2024-25, primarily driven by an increase
in AUM, improved yield profile, and enhanced
operating leverage.

The impairment on financial instruments decreased
to H 1,104.13 Crore in FY 2025-26 from H 1,458.17 Crore
in FY 2024-25 largely attributable to the erstwhile
small ticket personal loan book (STPL), which has
since been recalibrated. Policy interventions, across
other retail products leading to improved quality of
origination, coupled with better collection efficiency,
resulted in reduced forward flows aiding in reduction
in impairment cost.

The Company's Profit/(loss) after tax (“PAT”) on a
standalone basis increased to H 541.81 Crore in
FY 2025-26 from H (98.34) Crore in FY 2024-25.

As at March 31, 2026, the Company's Capital to Risk-
weighted Assets Ratio or the Capital Risk Adequacy
Ratio ("CRAR") was 16.83%, which is above the
regulatory minimum requirement of 15% prescribed
by the Reserve Bank of India ("RBI"). Following the
successful capital raise of H 2,500 Crore through
qualified institutional placement (QIP) in the month
of April 2026, the simulated CRAR was 20.74% basis
balance sheet for the financial year ended March 31,
2026, providing enough headroom for growth and
leverage at 3.78x.

ALM statement and Liquidity:

We have a well-diversified liability base supported
by long-term credit ratings of CRISIL AAA/Stable
and CARE AAA;Stable, short-term ratings of CRISIL
A1 and CARE A1 and our perpetual bonds are
rated CRISIL AA /Stable and CARE AA ;Stable, as of
March 31, 2026, reflecting our strong credit position.
Our NCDs are also rated BWR AAA/Stable and
ACUITE AAA/Stable by Brickwork Ratings India
Private Limited and Acuite Ratings and Research
Limited, respectively.

We have a diversified borrowing mix, including short
and long term loans from banks, NCDs, commercial
paper and external commercial borrowings, ensuring
depth and flexibility in market access. Our average
cost of borrowings (i.e., the ratio of our finance costs
for the relevant period/year to a simple average of
daily outstanding borrowings for the relevant period/
year) was 7.73% and 8.09% for FY 2025-26 and
FY 2024-25, respectively. We follow a prudent asset-
liability management (“ALM”) strategy, maintaining

a balanced mix of short-term and long-term assets
and liabilities. As of March 31, 2026, based on residual
maturity, 63.68% of our borrowings were long-term
borrowings, and 36.32% of our borrowings were short¬
term borrowings. Our strong credit rating, diversified
liability base and an optimized mix of short- and
long-term liabilities have supported a measurable
reduction in our cost of borrowings.

We further reinforce risk discipline through a board-
constituted Asset Liability Management Committee
(“ALCO”), which reviews changes in the economic
environment and suggests suitable strategies for
effective resource management, managing our cost
of funds and responsiveness to market conditions.
Further, we manage liquidity and interest rate risks
through ALM policies, daily liquidity coverage ratio
monitoring, duration sensitivity analysis and periodic
stress testing through our ALCO.

Transfer to reserve:

During the year under review, the Company has
transferred H 108.37 Crore to Reserve as required
under Regulation 45-IC of the Reserve Bank of India
Act, 1934.

Dividend:

In view of the future growth of the Company, the
Board of Directors has decided to conserve capital.
Therefore, the Board has decided not to recommend
dividend for FY 2025-26.

The Dividend Distribution Policy, in terms of
Regulation 43A of the Securities and Exchange
Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015 ("SEBI Listing
Regulations”) and as reviewed and adopted
by the Board of Directors of the Company, is
available on the Company's website viz., URL:
https://poonawallafincorp.com/documents
/20121/0/4. PFL Dividend Distribution Policy
Version No. 5.0.pdf/e1e4fa2a-b79f-599f-e02f-
670aa0a803a4

Subsidiary and Joint Venture companies and
its performance highlights:

The Company has one joint venture company, Jaguar
Advisory Services Private Limited (“JASPL”) and no
subsidiary company as on March 31, 2026.

JASPL, a joint venture with HDI Global SE is an
advisory service company domiciled in India. JASPL is
a special purpose vehicle (SPV) company. The Board
of Directors and the Shareholders of the Company

have approved divestment of 11,000 equity shares
constituting 48.89% of the share capital held by the
Company in JASPL, the said transaction is subject to
requisite regulatory approvals. The Board reaffirmed
the proposal to divest its shareholding in JASPL at its
meeting held on May 05, 2026, and accordingly in line
with the requirements of Ind - AS 105 “Non-current
Assets Held for Sale and Discontinued Operations”,
such investment has been classified as assets held
for sale.

During FY 2025-26, no new subsidiary, joint
venture or associate was incorporated/acquired.
The Company's Policy for determination of
material subsidiaries, as adopted by the Board
of Directors is in conformity with Regulation
16 of the SEBI Listing Regulations, can be
accessed on the Company's website athttps://
poonawallafincorp.com/documents/20121
/0/PFL-ACB-Policv-on-Material-Subsidiarv-
Version-No-6.0.pdf/701a6e1f-74a2-31a5-6f1a-
4f37e08f1219

Pursuant to the provisions of Section 129(3) of
the Companies Act, 2013 ("Act"), a statement
containing the salient features of financial
statements of the Company's subsidiary in e-Form
No. AOC-1 is attached to the financial statements of
the Company.

Consolidated financial statements:

In accordance with the requirements of Regulation
34 of SEBI Listing Regulations, your Company has
prepared Consolidated Financial Statements in
accordance with Ind AS -110 - ‘Consolidated Financial
Statements' and Ind AS- 27 - ‘Separate Financial
Statements'. The Consolidated Financial Statements
form part of this Report.

DEPOSITS:

Being a non-deposit taking NBFC, your Company has
not accepted any deposits from the public within the
meaning of the provisions of the Master Direction
of Reserve Bank of India (Non-Banking Financial
Companies - Acceptance of Public Deposits)
Directions, 2025 and the applicable provisions of
the Act.

CHANGE IN NATURE OF BUSINESS:

During the year under review, there has been no
change in the nature of business and operations of
the Company.

MATERIAL CHANGES AND COMMITMENTS
AFFECTING FINANCIAL POSITION BETWEEN
THE END OF THE FINANCIAL YEAR AND DATE
OF THE REPORT:

There have been no material changes and
commitments which affected the financial position of
your Company that have occurred between the end
of the financial year to which the financial statements
relate and up to the date of this Report.

MANAGEMENT DISCUSSION AND ANALYSIS:

In accordance with the applicable provisions of the
SEBI Listing Regulations, the Management Discussion
and Analysis Report, forms part of this Report.

EMPLOYEE STOCK OPTION SCHEMES:

Equity based compensation is an integral part of
employee compensation across sectors which
enables alignment of personal goals of the employees
with organizational objectives by participating in the
ownership of the Company through share-based
compensation scheme/plan. Your Company believes
in rewarding its employees for their continuous
hard work, dedication, and support, which have
contributed to the Company's growth and success.

The Employee Stock Option Plan (“ESOP”) granted
to the employees of the Company currently operate
under the following schemes:

- Employee Stock Option Plan 2021
(ESOP- 2021)

The Company has instituted the Employee Stock
Option Plan - 2021 (“ESOP 2021”), administered
by the Nomination and Remuneration
Committee ("NRC"). ESOP 2021 was approved
by the Board of Directors on June 19, 2021 and
our Shareholders on July 24, 2021. Under ESOP
2021, the maximum aggregate number of
stock options that could be allotted was limited
to 15,000,000 stock options, with each option
representing one Equity Share of the Company.
The NRC at its meeting held on June 01, 2024,
approved the termination of ESOP 2021 and
cancelled ungranted stock options under the
scheme. The stock options that have been
granted under ESOP 2021 to eligible employees
of our Company, and remain outstanding,
shall remain operational until such options are
exercised/lapsed.

- Employee Stock Option Plan 2024 Scheme
II (ESOP 2024 Scheme II)

The Company has instituted the Employee Stock
Option Plan - 2024 - Scheme II ("ESOP 24")
administered by the Nomination and
Remuneration Committee. ESOP 2024 was
approved by the Board of Directors on April 8,
2024, and our Shareholders on May 13, 2024.
Under ESOP 2024, the maximum aggregate
number of stock options that could be allotted
was limited to 20,000,000 stock options, with
each option representing one Equity Share of
the Company. These options were granted in the
absolute discretion of the NRC on the basis of
factors such as eligible employee's performance
appraisal, seniority, period of service, and present
and potential contribution to the growth of the
Company. ESOP 2024 was amended through a
special resolution passed by our Shareholders by
way of postal ballot on June 16, 2025, to increase
the maximum aggregate number of stock
options that could be allotted under this scheme
to 32,500,000 stock options, with each option
representing one Equity Share of the Company.

Accordingly, employee stock options were
granted to eligible employees under ESOP 2024,
from time to time pursuant to multiple grants
made by the Company. During the year under
review, 20,15,000 options were granted under
ESOP 2024 Scheme II of the Company.

The aforesaid schemes are in compliance with
Securities and Exchange Board of India (Share Based
Employee Benefits and Sweat Equity) Regulations,
2021 (“SEBI (SBEB & SE) Regulations, 2021”), to the
extent applicable. The NRC of the Company, inter alia,
administers and monitors the schemes in accordance
with the SEBI (SBEB & SE) Regulations, 2021.

A statement giving complete details, as on March 31,
2026, as required under the Act and Regulation 14
read with Part F of Schedule I of the SEBI (SBEB&SE)
Regulations, 2021 is available on the website of
the Company athttps://poonawallafincorp.com/
investor-governance.These details, along with
the certificate from the Secretarial Auditor of the
Company, as required under Regulation 13 of the
SEBI (SBEB & SE) Regulations 2021, the schemes
have been implemented in accordance with the
said Regulations, would be placed and available
for inspection by the Members during the Annual
General Meeting (“AGM”) of the Company. Grant
wise details of ESOP vested, exercised, allotted
and cancelled are also provided in the notes to the
standalone financial statements.

The Company has instituted the Employee Stock
Option Plan - 2024 (“ESOP 2024 - PFL Trust"),
administered by the NRC, to acquire, purchase, hold
and deal in the Equity Shares by way of secondary
acquisition through the PFL Employee Welfare
Trust. The ESOP 2024 - PFL Trust was approved by
the Board of Directors on January 18, 2024, and our
Shareholders on February 20, 2024. However, the
Board of Directors at their meeting held on June
01, 2024, approved the cancellation of ESOP 2024 -
PFL Trust and the dissolution of the PFL Employees
Welfare Trust, subject to requisite approvals and
compliances under applicable law. Under the said
scheme no stock options were granted by the
Company to any employee under ESOP 2024 - PFL
Trust. ESOP 2024 - PFL Trust is holding 48,30,000
equity shares of the Company as on March 31, 2026.
The shareholding is disclosed as "non-promotor and
non-public shareholding" in the shareholding pattern
of the Company.

CHANGES IN SHARE CAPITAL:

During the year under review, your Company allotted
16,55,156 equity shares of face value of H 2/- each
pursuant to the exercise of Employee Stock Options
by eligible employees of your Company, in accordance
with the applicable Employee Stock Option Scheme.

The Board of Directors, vide resolution dated
September 17, 2025, approved the allotment of
3,31,48,102 fully paid-up equity shares of face value
H 2/- each, at an issue price of H 452.51/- per equity
share (including a premium of H 450.51 per equity
share) aggregating to H 1499.98 Crore (Rupees
One Thousand Four Hundred Ninety Nine Crores
and Ninety Eight Lakh only), by way of preferential
allotment in accordance with the Securities and
Exchange Board of India (Issue of Capital and
Disclosure Requirements) Regulations, 2018 (“SEBI
ICDR Regulations") on a private placement basis to
Rising Sun Holdings Private Limited, the Promoter of
the Company.

At the close of the financial year, pursuant to the
aforesaid allotments, the issued, subscribed and
paid-up equity share capital of the Company stand
increased to H 1,625,635,316.00/- (Rupees One
Hundred Sixty-Two Crore Fifty Six Lakh Thirty
Five Thousand Three Hundred and Sixteen Only)
consisting of 812,817,658 Nos. of equity shares
(Eighty-One Crore Twenty Eight Lakh Seventeen
Thousand Six Hundred and Fifty-Eight).

After the close of the financial year, the Committee of
Directors of the Board on April 13, 2026, approved the
allotment of 67,430,883 fully paid-up equity shares of
face value H 2/- each, to eligible Qualified Institutional

Buyers, at an issue price of H 370.75 per equity share
(including a premium of H 368.75 per equity share)
aggregating to H 2,500 Crore (Rupees Two Thousand
Five Hundred Crore only), pursuant to the qualified
institutional placement (QIP) in accordance with the
applicable provisions of the SEBI ICDR Regulations,
2018 and the Act. The QIP Issue opened on April 9,
2026, and closed on April 13, 2026.

Further, the NRC on April 24, 2026, allotted 68,207
equity shares of face value of H 2/- each pursuant to
the exercise of Employee Stock Options by eligible
employees of your Company, in accordance with the
applicable Employee Stock Option Scheme.

Pursuant to aforesaid allotments, the issued,
subscribed and paid-up equity share capital of the
Company stand increased to H 1,760,633,496.00/-
(Rupees One Hundred Seventy-Six Crore Six Lakh
Thirty Three Thousand Four Hundred and Ninety Six
Only) consisting of 88,03,16,748 Nos. of equity shares
(Eighty-Eight Crore Three Lakh Sixteen Thousand
Seven Hundred and Forty-Eight).

The new equity shares issued shall rank pari-passu
with the existing equity shares of the Company.

FUND RAISING:

During the year under review, your Company
continued with its diverse methods of sourcing funds
including borrowing through NCDs, commercial
papers, external commercial borrowings, term
loan and working capital facilities and maintained
prudential Asset Liability match throughout the
year. Your Company sourced funds by way of issuing
NCDs to and obtaining loans from banks and other
institutions at competitive rates. Your Company
continues to expand its borrowing profile by tapping
new lenders.

During the year, the Company has raised fresh term
loans of H 14,725 Crore and external commercial
borrowings of H 1,281.40 Crore from banks and
other financial institutions for a door-to-door tenor
ranging from 3 (three) to 5 (five) years. The Company
also raised funds through commercial paper
aggregating to H 13,075 Crore (peak outstanding
of CP during the year was H 4,695 Crore) and
secured NCDs of H 13,580 Crore and Subordinated
NCDs of H 250 Crore during the year. The funds raised
through commercial papers and NCDs were utilized
for the purpose specified in the respective offer
documents. Catalyst Trusteeship Limited is acting
as Debenture Trustee of the Company, the details of
which are given in the Corporate Governance Report.
As on March 31, 2026, your Company does not have
any listed green debt securities.

Further disclosure related to Perpetual Debt
Instrument as per the Reserve Bank of India
(Non-Banking Financial Companies - Prudential
Norms on Capital Adequacy) Directions, 2025, is
provided in the standalone financial statements.

The Company on September 17, 2025, raised a
sum of H 1499.98 Crore fully paid-up equity shares
through preferential issue to its Promoter. Further,
on April 13, 2026, the Company successfully raised
I 2,500 Crore, by issuance of fully paid-up equity
shares through a Qualified Institutions Placement
(QIP). The issue witnessed strong participation from
institutional investors and long-term funds, reflecting
continued confidence in the Company's strategy and
growth outlook.

Pursuant to the provisions of regulation 32(7A) of
the SEBI Listing Regulations, the Company has
fully utilised the funds raised through preferential
issue for the objects stated in the offer document
and notice seeking Members approval i.e., Prepay/
repay the borrowings including interest thereon of
the Company, AUM growth and for lending towards
various financing activities as per applicable law/
regulation for NBFC and general corporate purposes.
CARE Ratings Ltd., monitoring agency, has issued
reports confirming utilisation of funds as per stated
objects. The said report is available on the Company's
website athttps://poonawallafincorp.com/investor-
governance. Statement of fund utilisation pursuant
to Regulation 32 of the SEBI Listing Regulations
has also been filed with the stock exchanges for
preferential issue. Pertaining to fund raising through

QIP, utilisation report under regulation 32(7A) of SEBI
Listing Regulations, 2026, will be disclosed as per
applicable timelines.

CREDIT RATING:

During the year under review, CRISIL Ratings
reaffirmed the ratings assigned to bank facilities and
debt instruments in March 2026. The ratings of long¬
term bank facilities, NCDs and Subordinated Debt
were reaffirmed as CRISIL AAA/Stable. Further, the
ratings of Commercial Papers and short-term bank
Facilities were reaffirmed as CRISIL A1 and Perpetual
Debt Instruments were reaffirmed as CRISIL AA /
Stable.

In March 2026, CARE Ratings reaffirmed the rating
assigned to bank facilities and debt instruments.
Ratings of long-term Bank Facilities, NCDs and
Subordinated Debt were reaffirmed at CARE AAA;
Stable, and the ratings of Market Linked Debentures
were reaffirmed at CARE PP-MLD AAA; Stable.
Ratings of Perpetual Debt were reaffirmed at CARE
AA ; Stable. The ratings assigned to short-term bank
facilities and commercial paper were reaffirmed at
‘CARE A1 '.

In February 2026, Brickwork Ratings reaffirmed the
ratings for the NCDs to ‘BWR AAA/Stable'. Further,
the rating of subordinated debt was also reaffirmed
to BWR AAA/Stable.

In May 2025, Acuite Ratings and Research Limited
also reaffirmed the long-term rating assigned to
NCDs as ‘ACUITE AAA/Stable'.

Status of ratings assigned by rating agencies and
migration of ratings during the year are provided in
note to the standalone financial statements.

PARTICULARS OF LOANS, GUARANTEE AND
INVESTMENTS OUTSTANDING DURING THE
FINANCIAL YEAR:

The Company, being an NBFC registered with the
RBI and engaged in the business of giving loans
in ordinary course of its business, is exempt from
complying with the provisions of Section 186 of the
Act with respect to loans. Accordingly, the disclosures
of the loans given as required under the aforesaid
section have not been made in this Board's Report.

Particulars of loans and investments outstanding
during the financial year are furnished in notes to the
standalone financial statements of the Company.

Further, the Company has not provided any loans to
Directors, senior officers and relatives of directors
as per the Reserve Bank of India (Non-Banking
Financial Companies - Credit Risk Management)
Directions, 2025.

RISK MANAGEMENT FRAMEWORK:

Risk Management:

The Risk Management Committee presently
comprises of Mr. Rajeev Sardana who serves as the
Chairman of the committee; Mr. Arvind Kapil, Mr. Sunil
Samdani, Mr. Vikas Pandey, Mr. Sanjay Kumar, and
Ms. Sonal Modi, as its other members.

The Company has adopted a Risk Management
Policy in accordance with the provisions of the Act
and Regulation 17(9) of the SEBI Listing Regulations.
Managing risk is fundamental to financial services
industry and it is key to ensure sustained profitability
and stability. In a rapidly changing economic,
geopolitical, regulatory and financial environment,
your Company has continued to leverage on their
strong risk management capabilities.

The Risk Management Committee functions are in
line with the Reserve Bank of India (Non-Banking
Financial Companies - Governance) Directions, 2025,
SEBI Listing Regulations and oversee implementation
of the Risk Management Framework of the Company.
The Risk Management Committee met 5 (five) times
during the year. Meeting details, terms of reference,
and its functioning are set out in the Corporate
Governance Report.

The Company understands that risk evaluation
and risk mitigation is a function of the Board of
the Company, and the Board of Directors are fully

committed to developing a sound system for
identification and mitigation of applicable risks
viz., systemic, and non-systemic. Information on
the development and implementation of a Risk
Management Policy for the Company is given in the
Management Discussion and Analysis. The Board is
of the opinion that there are no elements of risk that
may threaten the existence of the Company.

INTERNAL CAPITAL ADEQUACY ASSESSMENT
PROCESS:

Pursuant to Master Direction - Reserve Bank of India,
a Middle-layer NBFC is required to have an Internal
Capital Adequacy Assessment Process ("ICAAP") in
place which also covers stress testing. The objective
of ICAAP is to ensure availability of adequate capital
to support all material risks in business and also to
encourage NBFCs to develop and use better internal
risk management techniques for monitoring and
managing their risks. Accordingly, the Company has
framed and implemented an ICAAP policy. Pursuant
to which the Company assesses the adequacy of
its capital relative to its risk profile on a forward¬
looking basis.

INTERNAL FINANCIAL CONTROLS:

The management has laid down a set of standards,
processes and structure which enables it to implement
internal financial controls across the organization with
reference to financial statements and such controls
are adequate and are operating effectively. Internal
Finance control framework has been established
in line with the 'Guidance Note on Audit of Internal
Financial Controls over Financial Reporting' issued
by the Institute of Chartered Accountants of India
("ICAI").

During FY 2025-26, testing was conducted based
on process walkthrough and review of samples as per
documented controls in the Risk and Control Matrix.
Testing was done for the planned controls confirming
the existence and operating effectiveness of controls
over financial reporting. The review was performed
on design, adequacy and operating effectiveness of
the controls.

The internal financial controls are supplemented
by extensive internal audits, regular reviews by the
management and standard policies and guidelines
to ensure reliability of financial and all other records
to prepare financial statements, its reporting and
other data. The Audit Committee of the Board (“ACB”)
reviews internal audit reports given along with
management responses. The ACB also monitors the
implemented suggestions.

The Company has, in all material respects, adequate
internal financial control over financial reporting and
such controls operate effectively.

The Joint Statutory Auditors of the Company have also
certified the existence and operating effectiveness
of the internal financial controls relating to financial
reporting as of March 31, 2026. During the year
under review, no material or serious observation
has been observed for inefficiency or inadequacy of
such controls.

VIGIL MECHANISM/WHISTLE BLOWER POLICY:

The Company promotes ethical behavior in all
its business activities and is in line with the best
governance practices. The Company has a robust
vigil mechanism through its Breach of Integrity and
Whistle Blower/Vigil Mechanism Policy approved and
adopted by the Board of Directors of the Company
pursuant to Section 177(9) of the Act read with
Regulation 4(2)(d)(iv) and 22 of the SEBI Listing
Regulations and Regulation 9A(6) of the Securities
and Exchange Board of India (Prohibition of Insider
Trading) Regulations, 2015, the Company has in
place a vigil mechanism named ‘Breach of Integrity
and Whistle Blower/Vigil Mechanism Policy' to
provide a formal mechanism to the directors and
employees to report their concerns about unethical
behavior, actual or suspected fraud or violation of
the Company's Code of Conduct or Business Ethics.
The Policy provides for adequate safeguards against
victimization of employees who avail the mechanism
and provides for direct access to the Chairman of the
ACB in appropriate and exceptional circumstances.
A quarterly report on the whistle-blower complaints
was placed before the ACB for its review.

The details of the said Policy are explained in the
Corporate Governance Report and is available on the
website of the Company athttps://poonawallafincorp.
com/documents/20121/0/2. PFL
Breach of Integrity and Whistle Blower Vigil
Mechanism Policy Version No.7.0 %281%29.pdf/
a4086e28-bead-0511-93e5-b630b38a9bce

COMPLIANCE MANAGEMENT:

The Company is implementing a comprehensive
compliance management tool ("CMT") developed by
consultant, to strengthen its compliance framework.
The objective of CMT tool is to provide: - repository
of regulations, dissemination of actionable, seek
certification and keep audit trail of actionable, monitor

the observations via dashboard and reports and
escalate delays through alerts. This system enhances
transparency, accountability, and effective monitoring
of the Company's regulatory compliance obligations.

HUMAN RESOURCES:

Your Company firmly believes that employees are its
greatest asset. By orchestrating successful change
management initiatives aligned with the Company's
Vision and Mission, the Human Resources ("HR")
department has been pivotal in driving organizational
success through a series of transformative efforts. By
prioritizing innovation and efficiency, HR integrated
strategic automation and AI into core functions. Key
initiatives included the launch of the MD's Honour to
celebrate exemplary contributions, the introduction
of flexible work hours, and AI-driven hiring processes
that increased offer capacity. Additionally, continuous
learning and leadership development programmes,
such as the “Prarambh” induction programme and
the “SkillUp” digital learning platform, have ensured
that employees are well-equipped to meet future
challenges. These efforts have collectively elevated
the employee experience, built a robust, tech-enabled
HR ecosystem, and positioned your Company as a
leader in HR innovation and excellence.

Succession Planning:

The Company has in place succession planning
framework, the objective of the succession planning
inter-alia includes:

• To ensure that the business is not affected on
account of vacancies arising in the SMP, whether
such vacancies are caused by reasons such as
retirement, resignation, death or permanent
incapacitation or sudden exit for any other reason.

• To identify and create a pool of high potential
personnel, who can be considered for appointments
at SMP positions.

• To groom the pool identified and provide a
career path, to assume such higher roles and
responsibilities in a seamless manner whenever
the need arises.

The NRC and Board review succession planning
and transitions at the Board and SMP level. The
Board composition and the desired skill sets/areas
of expertise at the Board level are reviewed and
vacancies, if any, are reviewed in advance through a
systematic process.

Succession planning at SMP level, including business
and assurance functions, is reviewed to ensure
continuity and depth of leadership at 2 (two) below
the Managing Director. Successors are identified
prior to the SMP positions falling vacant, to ensure a
smooth and seamless transition. Succession planning
is a continuous process which is periodically reviewed
by NRC and the Board.

Compliance with the Maternity Benefit Act,
1961:

The Company is in compliance with the applicable
provisions of Maternity Benefit Act, 1961 in respect
of its female employees, including those relating to
maternity leave and associated benefits.

Prevention of sexual harassment at workplace:

The Company has zero tolerance towards sexual
harassment at the workplace and has adopted
a ‘Policy on Prevention and Redressal of Sexual
Harassment' to prohibit, prevent or deter any acts of
sexual harassment at workplace and to provide the
procedure for the redressal of complaints pertaining
to sexual harassment, thereby providing a safe and
healthy work environment, in line with the provisions
of Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013
and the rules thereunder ("POSH Act”). The Company
has complied with the provisions relating to the
constitution of the Internal Committee ("IC") under
the POSH Act.

During the year under review, no case of sexual
harassment was reported to the IC. The composition
of IC is in accordance with the POSH Act. To build
awareness and appreciation of this area, your
Company has implemented an online knowledge
module leveraging our learning management system.

Your Company continues to strive harder with each
passing year to ensure our organization succeed
in bringing the best out of our people and enable
the organization to create value for its shareholders
and employees.

INFORMATION TECHNOLOGY, GOVERNANCE
AND CYBER SECURITY:

Information Technology ("IT"):

The technological advancement in your Company
has resulted in multi-fold growth in the digital-led
business. There is significant growth in API based end-
to-end digital lending through mobile application,
digital DSAs and co-lending partners.

Your Company's IT guiding principles are:

(1) Digital first through increased digital footprint
across loan journeys.

(2) Offer best-in-class customer experience
across channels.

(3) Ensure "Scalable, Resilient, Predictable”
technology infrastructure with single governance
and 24x7 availability.

Your Company's Information Technology primary
focus areas include superior customer experience,
technology upgrade, new products/services,
innovations, productivity/process improvements,
digital acquisition, and data science/analytics with an
overall focus on observability to ensure resilience.

Your Company has launched its digital stack for
customer acquisition on instant personal loan,
business loan for direct customer acquisition. A tight
integration of this with the lead management and
dialer platform enables effective customer nudging
resulting in higher conversion. The EMIC card journey
has also been launched. In addition, the API stack
launched and consumed in embedded partner
journeys has enabled us to onboard more partners
for customer acquisition. Your Company has also
launched leasing business on its in-house platform.
Business processes in operations, customer service
and finance have been re-aligned as per industry-
best practices thus enabling end-to-end automation
of each process through seamless API based
integration of IT systems. Your Company continues
to enhance the website which enables efficient lead
generation through search engine optimization,
customer acquisition, user centric design and content
management framework to enable faster feature
launches on website.

We are focused on adopting AI across the organization
in different functions across customer service, risk
and collections with close integration of AI solutions
with the core IT solutions in customer acquisition,
CRM, core processing and collections.

We continue to build on our secure API stack with
a future proof strategy exposing the APIs for easy
consumption by our systems and external partners.
Our Data Lake architecture enables detailed journey
tracking, one customer view, efficient reporting. The
medallion architecture along with the functional data
pods enables effective business insights to cross sell,
customer 360 and propensity modelling.

Your Company has invested in various new
technologies like Digital Experience Platform, AI
based customer engagement and communications,
personalization, Digital Collections Platform, etc. Your
Company has also set up an IT command center for
24x7 monitoring of IT Infrastructure, applications and
digital services. Your Company has also implemented
Enterprise Data Lake platform, which will enable use
of multiple AI based algorithm for generating various
kinds of reports, MIS, and Dashboards. Use of analytics
will enhance customer penetration through digital
platform by providing various insights at data level.

A single governance platform established across this
application and infrastructure ecosystem ensures
a strong tracking and governance for compliance,
change and resiliency.

Your Company has achieved ISO/IEC 27001:2022
certification, a globally recognized standard in
Information Security Management.

Governance:

In accordance with the Reserve Bank of India
(Information Technology Governance, Risk, Controls
and Assurance Practices) Directions, 2023, the
Company has constituted the Information Security
Committee, IT Steering Committee, and IT Strategy
Committee. These Committees operate in line with
the respective charters approved by the Board and
play a critical role in strengthening the Company's
IT governance framework. The committees meet
on a quarterly basis, and details of their meetings
and terms of reference are set out in the Corporate
Governance Report.

Cyber Security:

During the year, your Company continued to
strengthen its cybersecurity posture through multiple
strategic initiatives. To ensure a systematic approach
to protecting sensitive data and enhancing resilience
against cyber threats, the Company successfully
underwent the ISO 27001 certification process and
audit, achieving certification from BSI.

The scope of Security Operations was expanded
to monitor a wider range of security events and
information across all digital assets. Enhanced
monitoring of databases was also implemented to
provide clear visibility into data access and activities.

Various proactive assessments were conducted
to detect and remediate risks, thereby minimizing
potential cyber threats. As part of the leadership-
focused cybersecurity awareness programme, a

cyber-attack simulation exercise was carried out,
followed by targeted awareness sessions.

In alignment with the Digital Personal Data Protection
Act, 2023 and the rules thereunder, awareness
sessions were organized for employees across all
departments. Recognizing the growing risks from
third parties, the Company onboarded a third party
risk monitoring platform to monitor external cyber
threats and risks proactively which are working with
the Company. Furthermore, with the increasing
adoption of AI, the information security team
developed an AI security governance framework and
conducted an AI security maturity assessment to
ensure responsible and secure use of AI technologies.

AI-SOLUTIONS TRANSFORMING OUR FUNCTIONS
AND CAPABILITIES EVOLVED FOR SCALE

AI now serves as a core operating layer across the
lending lifecycle. Our AI-first operating model now
informs pre-screening, underwriting, disbursals,
collections, and customer servicing, improving
turnaround time, credit quality, and cost efficiency.
Our AI/ML models power account aggregator-based
scoring and business rules engine-led underwriting,
persona-based models and bounce prediction in
collections, anomaly detection and policy review
automation in compliance, among others. The
ML-based model of repayment propensity and
engagement channels have improved early-stage
delinquency resolution and enhanced collection
efficiency with human oversight. Fraud risk is
addressed through layered AI-driven application
screening, real-time triggers biometrics, AI-based
face matching, and linkages to industry fraud
registries and watchlists. AI is embedded in frontline
and support functions alike HR use AI-driven hiring,
resume parsing, attrition prediction, conversational
support, and a candidate sourcing engine, improving
time-to-offer and onboarding effectiveness. Finance,
operations, secretarial, and strategy functions utilize
AI copilots, invoice auto-verification, and competition
mapping, while commercial teams deploy generative-
AI voice bots and cross-sell automation.

As of March 31, 2026, we advanced 76 AI initiatives,
including 42 fully deployed and 34 underway viz.,
spanning credit, underwriting, collections, analytics,
risk, compliance, audit and compliance, operations,
customer service, admin and infrastructure, secretarial,
HR, among others. We have also established a
"MarTech” marketing technology stack centered on
AI-driven automation to improve customer acquisition
and engagement, particularly in the digital lending

space. “MarTech” focuses on real-time, minimum
human intervention marketing, including the ability
to generate targeted marketing campaigns which
do not require any human intervention. Further, we
have launched our Al-powered credit underwriting
assistant which is designed to reduce manual
processes and enhance consistency and accuracy
by reviewing and interpreting customer information
and documentation to generate a summary for the
underwriters. The credit AI underwriting platform
utilizes large language models and machine
learning to enhance underwriting productivity, in
line with our “risk-first” model. In addition, we have
developed a fully-automated suspicious transaction
reporting layer, an AI and machine learning powered
solution designed to improve anti-money laundering
compliance by reducing false positives and identifying
genuinely risky behaviors. We have also developed
our “RegIntel” compliance assistant, an autonomous
AI tool that analyzes RBI advisories, maps them
to internal policies, and provides instant, context-
aware summaries to ensure regulatory compliance.
Moreover, we have also developed AI-powered HR and
travel tools, such as “PAI@HR”, a WhatsApp-powered
chatbot for instant employee support on policies
and payroll, and “Travel Bot”, an AI-integrated bot in
Microsoft Teams that streamlines travel bookings,
ensures policy compliance and centralizes records.
Further, one of our AI initiatives which is underway is
“Build Buddy”, an AI-powered development assistant
that will be integrated into our existing technology
stack to accelerate application development and
improve software quality. These AI-led interventions
are translating into measurable improvements in
productivity, cost efficiency, decision accuracy, and
customer experience, while enabling scalable growth.

We have received several awards and recognitions in
relation to our AI infrastructure and initiatives.

CORPORATE IMAGE BUILDING & ENGAGING
TARGET AUDIENCE:

Public Relations and External Communication:

In FY 2025-26, the Company scaled up its
communications from a strong foundation,
foregrounding visibility and strengthening its
positioning as a responsible, risk-first lender under
a stable, execution-focused leadership team. During
the year, the Company focused on broadening its
media footprint, sharpening its corporate identity,
and proactively shaping a consistent and compelling
narrative around the business being built on
the ground.

Public relations efforts in FY 2025-26 were anchored
around three themes, mainly, the Company's
multichannel growth story, its technology and
AI adoption across functions, and its expanding
product suite for underserved segments in the credit
ecosystem. A significant milestone of FY 2025¬
26 was the successful expansion from 7 (seven) to
13 (thirteen) businesses under the new leadership.
The company's strategic PR efforts highlighted
this rapid transformation. High-impact media
engagements anchored the corporate narrative. 4
(four) product launches being Shopkeeper Loan, Gold
Loan, Consumer Durable Loan, and Business 24x7
Loan were communicated through a national press
release strategy with financial, capital markets, and
trade media, supported by a hyperlocal approach
across 16 (sixteen) key regional cities along with digital
amplification on owned channels. The Company's AI-
first transformation across governance, compliance,
customer engagement, and HR processes was
communicated systematically through national and
trade press releases, strengthening the Company's
positioning as a digital-first lender embedding
technology across every function.

Sustained communication around its technology
transformation and expanding product suite resulted
in increased media recall and strengthened brand
positioning. Overall media visibility grew nearly
15x, significantly enhancing brand visibility and
investor engagement. The H 1,499.98 Crore promoter
infusion and the subsequent H 2,500 Crore QIP were
communicated as markers of sustained institutional
and promoter confidence in the Company's capital
strength and growth trajectory.

Awards and Recognitions:

Company received several awards during the year
under review, including:

• “Prestigious Brands of Asia” at 9^th Edition of
Prestigious Brands of Asia 2026;

• “Most Innovative Digital Journey” at the India NBFC
Summit & Awards 2025;

• “Technology Senate Awards 2025 in Artificial
Intelligence” at The Indian Express Groups and
Express Computer 2025;

• “Innovative in Customer Experience” at CII DX
Awards 2025;

• “Most Innovative Organizations 2025” by ET Edge;

• “The Technology Senate Awards 2025” for the
“Artificial Intelligence” category, by The Indian
Express Group and Express Computer;

• “Express BFSI Technology Award 2025” for
customer experience, in relation to our PL Prime
Digital 24x7 platform, by Express Computer;

• Recognition in the "Innovative in Customer
Experience” category at the DX Awards 2025;

• “Winner in the ‘Future of Work' category” at the 3^rd
FICCI National HR Innovation Awards 2025;

• “Most Innovative Digital Journey - Education Loans”
at the India NBFC Summit and Awards 2025; and

• “Most Innovative Practice Awards” at the 2^nd
edition of the CII National Artificial Intelligence (AI)
Awards 2025 for the categories “AI in underwriting
solution” and “AI in hiring solution”.

CORPORATE SOCIAL RESPONSIBILITY

Your Company has a comprehensive Corporate Social
Responsibility (“CSR”) Policy outlining programmes,
projects and activities that your Company
undertakes to create a significant positive impact
on disadvantaged section of the society. All these
programmes fall within the purview of Section 135
read with Schedule VII of the Act and the Companies
(Corporate Social Responsibility Policy) Rules, 2014
(“CSR Rules”). Your Company has undertaken socially
impactful CSR projects during the year under review.
Your Company has partnered with implementing
agencies to implement projects in the CSR focus area
viz., healthcare, education and skill development and
livelihood and women empowerment.

During FY 2025-26, your Company was required
to spend H 6.56 Crore under CSR as enumerated in
Section 135(5) of the Act. Your Company has spent an
amount of H 6.56 Crore on CSR activities. The Annual
Report on CSR activities covering details pertaining
to CSR Policy developed and implemented by the
Company, CSR project undertaken during the year,
CSR Committee and meeting details is annexed
herewith and marked as Annexure-1. Further, in
terms of the CSR Rules, the Chief Financial Officer
has certified that the funds disbursed have been
utilized for the purpose and in the manner approved
by the CSR Committee and the Board of Directors of
your Company.

CSR Policy weblink:https://poonawallafincorp.
com/documents/20121/0/PFL CSR Policy
Version No. 6.0.pdf/26949d61-3047-4792-4600-
33e5a62ec4ac

CUSTOMER RELATIONSHIP MANAGEMENT:

Aligned with our Vision to become the most trusted
financial services brand and our philosophy of
customer first approach, customer service remains
central to our operations and receives significant
attention from management. The Company
upholds values of ethics, integrity, good governance,
professionalism, transparency, and customer
satisfaction. Special focus has been on the quality and
consistency of service delivery.

Your Company is committed to gauging customer
feedback as a true reflection of its service levels.
Valuable customer insights at each stage of
relationship with the Company have been the
guiding factor to continuously improving and
digitizing its processes and service delivery. Our
Net Promoter Score (NPS) - a key indicator of
customer perception and brand loyalty is used
to gauge customer feedback on our product,
processes and service level. Introducing digital
NPS through link based survey trigger allowed
us to increase the coverage to gather timely
feedback and make necessary improvements.
Your Company actively addresses customer
insights and identified opportunities for process
improvement as part of our ongoing commitment
to continuous enhancement.

Our customers have multiple options like dedicated
toll-free number, dedicated email ids, branches, social
media accounts to reach us for their queries, requests
or grievances.

Your Company has enabled robust self-service
platforms like mobile application, WhatsApp bot,
web-bot, customer portal and smart IVR for instant
servicing, which is available 24x7, enhancing
customer convenience.

Key initiatives were undertaken to enhance
Customer Service and Experience:

1. Launch of Conversational AI Platform for
Unified Customer Support

To further strengthen service responsiveness
and scalability, the Company launched a
conversational AI platform designed to
simultaneously handle a majority of routine
customer queries.

• The platform provides a unified and consistent
experience across both chat and voice
channels, enabling customers to access
information and support seamlessly through
their preferred mode of interaction.

• With intelligent intent recognition and
automated resolution capabilities, the solution
significantly improves turnaround time for
customer queries while allowing service
agents to focus on more complex cases.

2. Enablement of End-to-End Payment-Related
Servicing on Digital Channels

To enhance customer convenience and reduce
dependency on assisted channels, the Company
enabled comprehensive payment-related
servicing on digital platforms such as the mobile
application and WhatsApp for selected products.

• Customers can now digitally complete key
transactions including loan foreclosure, part
payment and payment of overdue EMIs, at
anytime and from anywhere.

• This resulted in faster transaction completion,
improved transparency of charges and
outstanding amounts, and greater control for
customers over their loan accounts without
the need for branch or call center intervention.

3. Launch of Customer Portal to Strengthen
Self-Service Capabilities

As part of its digital self-service strategy, the
Company introduced a customer portal as an
additional servicing platform alongside the
existing mobile app and WhatsApp channel.

• The portal provides access to customers to
important loan-related documents such
as Statement of Accounts, welcome letter
and other communication, ensuring easy
availability of information on demand.

• Customers can also initiate and complete
payment-related services, thereby improving
service accessibility, consistency and
continuity across multiple digital touchpoints.

Handling Grievances effectively:

• Prompt acknowledgment to customers via
auto E-mail and SMS trigger upon receipt of
any complaint.

• A detailed Root Cause Analysis (RCA) carried out
for each complaint.

• All critical cases including regulatory escalations
are reviewed by Principal Nodal Officer and Chief
Compliance Officer.

• Close looping feedback mechanism ensures
customers are informed at the time of closure of
the Service Request for customer concurrence on
the resolution being provided and upon closure in

system the same is backed by an SMS trigger for
customers' reference.

• All partially/wholly rejected complaints (subject to
exclusions as per regulatory circular) are reviewed
by the Internal Ombudsman of the Company and
the final decision is communicated to the customer
within the regulatory timelines.

• Necessary governance mechanism is in place for
any case of violation of Code of Conduct while
dealing with customer.

Customer service and grievance redressal:

The customer service and grievance redressal
framework is built on a Board-approved policy
architecture that aligns with applicable laws
and regulations, including the RBI Guidelines on
customer service for regulated entities, fair practices,
outsourcing of financial services and information
security. The framework is designed to provide clear
service standards, transparent communication, time-
bound resolution of customer issues, and continuous
improvement through measurement, governance
and root-cause remediation.

The customer service model is omni-channel,
supported by relationship teams, branches and
a centralized service organization. Customers
can access us via branches, a toll-free call center,
email, web and mobile portals, chat interfaces and
assisted channels. We define turnaround times for
key service requests, including onboarding queries,
loan servicing, statement and certificate issuance,
foreclosure and part-prepayment, refunds and
charge reversals, and dispute handling. These service
standards are communicated on our website and
in customer communications and are periodically
reviewed based on customer feedback, operational
analytics and regulatory expectations. We provide
customers with clear pre and post-disbursement
disclosures, including the key fact statement,
amortization schedules, applicable fees and charges,
and contact points for support and escalation. Our
fair practices and responsible lending approach
emphasize suitability, transparency of pricing and
charges, and non-discriminatory treatment.

Grievance redressal is governed by a documented,
Board approved policy and an escalation framework
designed to ensure timely, fair and effective resolution
of customer complaints. The Company follows a four
level escalation matrix, which is communicated to
customers through branches, digital channels and
the Company's website.

At Level 1, customers may raise concerns by reaching
out to the customer service executive through the

branch network, contact centre, email or other digital
channels. All complaints are logged in a centralized
ticketing system and assigned unique reference
numbers, have defined categories and time bound
resolution targets in line with the Company's policy.

At Level 2, complaints that remain unresolved or
where customers are not satisfied with the resolution
at Level 1 may be escalated to the Grievance Redressal
Officer for supervisory review and resolution within
the prescribed timelines.

At Level 3, customer if not satisfied at Level 2, may
further escalate the complaint to the Principal Nodal
Officer, who oversees grievance handling across the
organization and ensures compliance with regulatory
requirements and internal service standards.

At Level 4, if the customer is not satisfied with the
resolution provided or if no response is received
within 30 (thirty) days of lodging the complaint,
customers may escalate the matter to the RBI under
the Integrated Ombudsman Scheme. Details of the
escalation process, along with contact information of
the Grievance Redressal Officer and Principal Nodal
Officer, are prominently displayed at branches and on
the Company's website.

The Company employs a governance structure that
includes a Board-level Customer Service Committee
and a management level forum to oversee service
quality, complaints, product suitability and
customer conduct risk. These bodies review periodic
dashboards on complaint volumes, categories,
turnaround times, ageing and first-contact resolution,
as well as thematic analyses, root-cause trends and
action plans. Significant issues, systemic risks and
regulatory interactions are reported to the Board with
remediation tracking. We also conduct internal audits
and process reviews of customer-facing functions,
outsourced arrangements and activities, with
particular emphasis on sales practices, disclosures,
collections conduct and information security.

Technology underpins our service delivery through a
unified customer relationship management platform
integrated with our loan management systems.
This platform enables end to end ticket lifecycle
management, knowledge bases for standardized
responses, AI assisted triage and prioritization,
sentiment analysis and automated notifications.
During the year, the Company also launched a
conversational AI platform capable of autonomously
addressing a significant portion of customer queries,
providing a seamless and consistent experience
across chat and voice channels. We maintain robust
information security and data privacy controls,
including role based access, encryption, data retention

and consent management, in line with applicable
Indian laws and RBI expectations. Our staffing model
includes continuous training and certification on
product knowledge, fair practices, grievance handling
and vulnerable customer considerations.

DIRECTORS AND KEY MANAGERIAL
PERSONNEL:a. Board Composition

The composition of the Board of Directors
of the Company is governed by the Act and
Regulation 17 of the SEBI Listing Regulations
and is in conformity with the same. As on the
date of this Report, the Board of Directors
comprised a combination of 10 (ten) Directors
viz. Mr. Adar Cyrus Poonawalla, Chairman, Non¬
Executive Director, Mr. Arvind Kapil, Managing
Director and Chief Executive Officer, Mr. Sunil
Samdani, Executive Director, Mr. Vikas Pandey,
Executive Director, Ms. Sonal Modi, Non¬
Executive Director, and, Mr. Prabhakar Dalal,
Mr. Sanjay Kumar, Ms. Kemisha Soni, Mr. Kewal
Handa, and Mr. Rajeev Sardana as Non-Executive
Independent Directors. The Board mix provides
a combination of professionalism, knowledge
and experience required in the NBFC sector.
The details of skills possessed by each director
have been provided in detail in the Corporate
Governance report. The terms and conditions
of appointment of Independent Directors are
available on the website of the Company athttps://
poonawallafincorp.com/investor-governance.

b. Change in composition of the Board
during the year:

Appointment/Re-appointment:

The Board of Directors, at its meeting held on
January 16, 2026, approved the appointment of
Mr. Vikas Pandey (DIN: 11463386) as the Whole
Time Director of the Company (also designated as
KMP) for a period of 5 (five) years with effect from
January 16, 2026 till January 15, 2031. Thereafter,
the Members of the Company approved his
appointment by postal ballot through remote
e-voting on February 19, 2026.

Cessation:

During the year under review Mr. Bontha Prasada
Rao (DIN: 01705080), Independent Director,
ceased to be the Director of your Company with
effect from December 09, 2025, upon completion
of his two consecutive terms. The Board and entire

management team acknowledge the invaluable
contributions made by Mr. Bontha Prasada Rao,
during his tenure as an Independent Director,
and place on record their deep appreciation
for his guidance, support, and contribution to
the Board.

c. Retirement by Rotation:

In accordance with the provisions of Section 152
of the Act read with the Articles of Association of
the Company, Mr. Adar Cyrus Poonawalla, (DIN:
00044815) Chairman, Non-Executive Director
will retire by rotation at the ensuing AGM and
being eligible, offers himself for re-appointment.
The Board of Directors of your Company
recommends the re-appointment of the Director
liable to retire by rotation at the ensuing AGM.
Appropriate resolution seeking your approval
for the aforesaid re-appointment along with
brief profile of the said Director is forming part
of the Notice convening the Forty Sixth AGM of
your Company.

d. Declaration from Directors:

The Company has, inter alia, received the
following declarations from all the Independent
Directors confirming that:

a. they meet the criteria of independence
as prescribed under the provisions of the
Act, read with Schedule IV and the rules
issued thereunder, and the SEBI Listing
Regulations. There has been no change in
the circumstances affecting their status as
Independent Directors of the Company;

b. they have complied with the Code for
Independent Directors prescribed under
Schedule IV to the Act; and

c. they have registered themselves with
the Independent Director's data bank
maintained by the Indian Institute of
Corporate Affairs and have qualified the
online proficiency self-assessment test or are
exempted from passing the test as required
in terms of Section 150 of the Act read with
Rule 6 of the Companies (Appointment and
Qualifications of Directors) Rules, 2014.

The Board of Directors of the Company has taken
on record the declaration and confirmation
submitted by the Independent Directors.

All members of the Board of Directors and SMP
have affirmed compliance with the Code of
Conduct for the FY 2025-26.

None of the Directors of the Company are
disqualified from being appointed as Director
as specified under Section 164(1) and
164(2) of the Act read with Rule 14(1) of the
Companies (Appointment and Qualifications of
Directors) Rules, 2014 (including any statutory
modification(s) and/or re-enactment(s) thereof
for the time being in force) or are debarred or
disqualified by the Securities and Exchange Board
of India ("SEBI”), Ministry of Corporate Affairs
("MCA”) or any other such statutory authority.

In the opinion of the Board, the Independent
Directors possess the requisite integrity,
experience, expertise, and proficiency required
under applicable laws and the policies of
the Company.

During the year under review, separate meetings
of the Independent Directors were held on
October 15, 2025, and March 27, 2026.

During the year under review, the Non-Executive
Directors of the Company had no pecuniary
relationship or transactions with the Company,
other than sitting fees and commission, as
applicable, received by them.

The Company has obtained certificates from
Practicing Company Secretaries confirming that:

• None of the Directors on the Board of the
Company has been debarred or disqualified
from being appointed and/or continuing as
Director by the SEBI/MCA or any other such
statutory authority.

e. Fit and Proper Policy:

The Company adheres to the process and
methodology prescribed by the RBI in respect of
the ‘fit & proper' criteria as applicable to NBFCs,
signing of Deed of Covenants which re-affirms
that the directors are required to discharge
their responsibilities to the best of their abilities,
individually and collectively in order to be eligible
for being appointed/re-appointed as a director of
the Company.

All the Directors of the Company have confirmed
that they satisfy the "fit and proper” criteria
as prescribed in Chapter IV of Reserve Bank
of India (Non-Banking Financial Companies -
Governance) Directions 2025 and that they are
not disqualified from being appointed/continuing
as directors in terms of Section 164(2) of the Act.
The prescribed declarations/undertakings given

by the Directors were placed before the NRC for
its review and noting.

f. Familiarization Programme for Independent
Directors:

In compliance with the requirement of
Regulation 25 of SEBI Listing Regulations, the
Company has put in place a familiarization
programme for the Independent Directors to
familiarize them about the Company and their
roles, rights and responsibilities in the Company.
The details of the familiarization programme
along with the number of hours spent by each of
the Independent Directors during the FY2025-
26 are explained in the Corporate Governance
Report. The same is also available on the website
of the Company athttps://poonawallafincorp.
com/documents/20121/0/Familiarization-
program-FY25-26 %281%29.pdf/da464113-
946c-af95-e0f4-1e14637b425c

g. Performance Evaluation:

The Board conducted the performance evaluation
of the individual Directors, Board Committees,
Board as a whole and the Chairman of the
Board, in accordance with the provisions of the
Act and the SEBI Listing Regulations, including
the 'Guidance Note on Board Evaluation' issued
by SEBI.

The Board evaluated the effectiveness of its
functioning and that of the committees and of
individual Directors by seeking their input on
various aspects of Board/committee Governance
through structured questionnaire. Also, the NRC
has carried out evaluation of every Director's
performance and reviewed the self-evaluation
submitted by the respective directors. The
performance evaluation of the Independent
Directors was carried out by the entire Board,
excluding the director being evaluated.

The aspects covered in the evaluation
included the contribution to and monitoring of
corporate governance practices, participation
in the long-term strategic planning and the
fulfilment of directors' obligations and fiduciary
responsibilities, including but not limited to,
active participation at the Board and Committee
meetings. Also, the NRC has carried out an
evaluation of every Director's performance
and reviewed the self-evaluation submitted
by the respective Directors. These meetings

were intended to obtain Directors' input on the
effectiveness of Board/Committee processes.

The evaluations were carried out in a confidential
manner, and the Directors provided their
feedback by rating based on various metrics.

The Board considered and discussed the
input received from the Directors. Further,
the Independent Directors at their meeting
reviewed the performance and role of Non¬
Independent Directors and the Board as a whole
and Chairperson of the Company and had also
assessed the quality, quantity, and timeliness
of flow of information between the Company
management and the Board that was necessary
for the Board to perform their duties effectively
and reasonably.

h. Outcome of evaluation process:

Based on inputs received from the Board
members, it emerged that the overall

performance evaluation of the Board,

composition, and quality, understanding of the
business including risks, process and procedures,
oversight of financial reporting process including
internal controls and audit functions, ethics
and compliances and monitoring activities, has
been found to be reasonably good. Similarly,
the effectiveness of the Board committees have
been rated high. The committees of the Board
function effectively. Sufficient time is allotted for
discussion of the agendas. Contrary views were
also encouraged and the same were viewed in
the right perspective. The performance of the
Chairman of the Company has been found to
be excellent. Overall, the Board is functioning
very well in a cohesive and interactive manner.
Last year the recommendations of Independent
Directors and Board on performance evaluation
were largely implemented.

i. Remuneration Policy:

The Remuneration Policy for Directors, KMP,
SMP and all other employees is aligned
to the philosophy on the commitment of
fostering a culture of leadership with trust. The
Remuneration Policy aims to ensure that the
level and composition of the remuneration
of the Directors, KMPs, SMPs and all other
employees is reasonable and sufficient to
attract, retain and motivate them to successfully
run the Company. The salient features of the
Remuneration Policy are stated in the Corporate
Governance Report. The Remuneration Policy

of the Company is available on the Company's
website athttps://poonawallafincorp.com/
documents/20121/0/PFL-Remuneration-Policv-
Version-No-8.0.pdf/0b67101a-0143-22da-31ae-
597eb8e47056. The remuneration details of
Directors and KMPs are provided in the Corporate
Governance Report.

j. Compensation Policy:

In accordance with the applicable guidelines
issued by the RBI, the Company has adopted
a Compensation Policy applicable to all
employees. The Policy is designed to ensure that
compensation practices are aligned with the
Company's core value, strategic business goals
risk framework, and regulatory expectations.

k. Code of Conduct for Directors and
Employees:

The Company has adopted a Code of Conduct
for its Directors and employees including a
Code of Conduct for Independent Directors
which suitably incorporates the duties of
Independent Directors as laid down in the
Act. The said Codes can be accessed on the
Company's website athttps://poonawallafincorp.
com/documents/20121/0/1. PFL
Code for Independent Directors
Version No.7 %281%29.pdf/4a547586-aacd-
c48e-d87d-2ec572df77fb

In terms of the SEBI Listing Regulations, all
Directors and SMP have affirmed compliance
with their respective Codes. The Managing
Director and Chief Executive Officer have also
confirmed and certified the same, for which
certification is provided at the end of the Report
on Corporate Governance.

l. Key Managerial Personnel:

In terms of Section 203 of the Act, the following
are the KMP of the Company as on the date of
this report:

1. Mr. Arvind Kapil, Managing Director & Chief
Executive Officer;

2. Mr. Sunil Samdani, Executive Director;

3. Mr. Vikas Pandey, Executive Director

4. Mr. Sanjay Miranka, Chief Financial
Officer; and

5. Ms. Shabnum Zaman, Company Secretary.

DIRECTORS’ RESPONSIBILITY STATEMENT:

To the best of our knowledge and belief, your directors
make the following statements in terms of Section
134 (5) of the Act:

a. that in the preparation of the annual accounts for
the year ended March 31, 2026, the applicable
Ind AS have been followed along with proper
explanation relating to material departures, if any;

b. that such accounting policies as mentioned in
Notes to the annual accounts have been selected
and applied consistently and judgement and
estimates have been made 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, 2026 and of the profit for the year ended on
that date;

c. that proper and sufficient care has been taken
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. that the annual accounts have been prepared on
a going concern basis;

e. that proper internal financial controls are in place
and that the financial controls are adequate and
are operating effectively; and

f. that proper systems to ensure compliance
with the provisions of all applicable laws are in
place and that such systems are adequate and
operating effectively.

MEETINGS AND COMMITTEES OF THE BOARD
OF DIRECTORS:

Number of Meetings of the Board:

During the year under review, 4 (Four) Board
meetings were held, the details of which are given
in the Corporate Governance Report. The maximum
interval between any 2 (two) consecutive meetings
did not exceed 120 days, as prescribed by the Act and
the SEBI Listing Regulations.

Committees of the Board of Directors:

The committees of the Board focus on certain specific
areas and make informed decisions in line with the
delegated authority. The Board committees have
been constituted to deal with specific areas/activities
as mandated by applicable rules and regulations or as
delegated by the Board, which need a closer review.

Audit Committee

The ACB presently comprises of Mr. Kewal Handa
who serves as the Chairman of the committee and
Ms. Sonal Modi, Mr. Prabhakar Dalal, Mr. Sanjay Kumar,
and Ms. Kemisha Soni as other members. 4 (Four)
meetings were held during the year under review,
details of which and terms of reference for the ACB
have been furnished in the Corporate Governance
Report. All the recommendations made by the ACB
during the year were accepted by the Board.

Nomination and Remuneration Committee

The NRC presently comprises of Mr. Prabhakar Dalal
who serves as the Chairman of the committee,
Mr. Kewal Handa, Mr. Rajeev Sardana, and Ms. Sonal
Modi as other members. The terms of reference of
the NRC and details of NRC meetings and attendance
thereof have been furnished in the Corporate
Governance Report.

Stakeholders Relationship Committee

The Stakeholders Relationship Committee presently
comprises of Mr. Prabhakar Dalal who serves as the
Chairman of the Committee, Mr. Sunil Samdani,
Mr. Vikas Pandey, Ms. Sonal Modi, and Mr. Sanjay
Kumar as other members. The terms of reference of
the Stakeholders' Relationship Committee have been
furnished in the Corporate Governance Report.

Corporate Social Responsibility Committee

The CSR Committee presently comprises of
Ms. Kemisha Soni who serves as the Chairperson
of the Committee and Mr. Sunil Samdani, Mr. Vikas
Pandey, Ms. Sonal Modi and Mr. Prabhakar Dalal, as
other members.

The other Committees of the Board are the Asset
Liability Management Committee, Risk Management
Committee, IT Strategy Committee, Review
Committee, Customer Service Committee and the
Management Committee. The details of composition,
terms of reference and number of meetings held for
the respective committees have been furnished in
the Corporate Governance Report.

CONTRACTS OR ARRANGEMENTS WITH
RELATED PARTIES:

In line with the requirements of the Act and
the SEBI Listing Regulations, the Company has
in place a Policy on Related Party Transactions
and the same can be accessed on the

Company's website athttps://poonawallafincorp.
com/documents/20121/0/3. Policy
for Related Party Transactions Clean
Version No. 8.pdf/1c289655-513f-f60d-cb8f-
5b6fb35196c6.

All transactions with related parties are placed before
the ACB for approval. All related party transactions
that were entered into during the financial year were
on an arm's length basis and in the ordinary course
of business, the particulars of such transactions are
disclosed in the notes to the financial statements.
During the year under review, there were no materially
significant related party transactions. Disclosures of
related party transactions of the Company with the
promoter/promoter group, which holds 10% or more
shareholding in the Company, if any, are given in note
to the standalone financial statements.

None of the related party transactions entered into
by the Company during FY 2025-26 attracted the
provisions of Section 188(1) of the Act. Accordingly,
disclosure in e-Form No. AOC-2 pursuant to Section
134(3)(h) of the Act is not applicable to the Company.
e-Form No. AOC-2 is attached to this Report
as Annexure-2.

SIGNIFICANT AND MATERIAL ORDERS
PASSED BY THE REGULATORS OR COURTS OR
TRIBUNALS:

During the year under review, there were no significant
material orders passed by the Regulators/Courts/
Tribunals against the Company which would impact
the going concern status or its future operations.

STATUTORY AUDITORS:

Based on the recommendation of the ACB and the
Board, the Members of the Company, at the 44^th AGM
held on July 23, 2024, approved the appointment
of M S K A & Associates LLP (formerly known as M S
K A & Associates)(Firm Registration No. 105047W/
W101187), as Joint Statutory Auditors of the Company,
to hold office from the conclusion of the 44^th AGM
until the conclusion of the 47^th AGM of the Company.

In terms of the RBI Circular No. RBI/2021-22/25
Ref. No. DoS.CO.ARG/SEC.01/08.91.001/2021-22
dated April 27, 2021, on Guidelines for Appointment
of Statutory Central Auditors (“SCAs”)/Statutory
Auditors (“SAs”) of Commercial Banks (excluding
Regional Rural Banks), Urban Co-operative Banks
(“UCBs”) and Non-Banking Financial Companies
(“NBFCs”) (including Housing Finance Companies)
(“RBI Guidelines”), the statutory audit of the entities
having asset size of H 15,000 crore and above as at

the end of previous year, should be conducted under
the joint audit of a minimum of two audit firms, and
in accordance with the requirements of Section 139
of the Act, read with Rules made thereunder, MSKA &
Associates LLP, Chartered Accountants and Kirtane &
Pandit LLP, Chartered Accountants, act as the Joint
Statutory Auditors of the Company.

The terms of appointment of Kirtane & Pandit
LLP, Chartered Accountants, (Firm Registration
No.105215W/W100057) as one of the Company's
Joint Statutory Auditors expire at the conclusion of
the 46^th (Forty Sixth) AGM of the Company.

In view of the same, based on the recommendation
of the ACB, the Board at its meeting held on May 05,
2026, recommended the appointment of B. K. Khare
& Co., Chartered Accountants (Firm Registration
No. 105102W), as Joint Statutory Auditors of the
Company, to hold office from the conclusion of the
46^th (Forty Sixth) AGM until the conclusion of the 49^th
(Forty Ninth) AGM of the Company, subject to the
approval of the Members at the ensuing AGM.

B. K. Khare & Co., Chartered Accountants, is professional
services firm in the field of Assurance, Direct Tax,
Transfer Pricing, Indirect Tax and Risk Advisory. The
firm has twenty Partners and 150 associates. The
firm operates from Mumbai, Pune, Bangalore, Delhi
and Chennai, and have associates in all major cities in
India. The firm has rich experience for over 6 decades
in sectors like NBFC, Banking, Insurance, Mutual
Funds, Automobile & Auto component, Real Estate,
Engineering, IT & Software and Oil & Gas. Established
in 1955 by Late Mr. B. K. Khare, a statesman in the
Indian accounting and tax profession, B.K. Khare & Co.
has grown to become a prestigious firm.

As required under Regulation 33(1)(d) of the SEBI
Listing Regulations, the Joint Statutory Auditors have
confirmed that they have subjected themselves to
the peer review process of the ICAI and that they hold
a valid certificate issued by the Peer Review Board
of ICAI.

The Standalone and the Consolidated Financial
Statements of the Company have been prepared in
accordance with Indian Accounting Standards (Ind
AS) notified under Section 133 of the Act. The notes
on financial statements referred to in the Auditors'
Report are self-explanatory and do not call for any
further comments.

There are no qualifications, reservations or adverse
remarks or disclaimers made by M S K A & Associates
LLP, Chartered Accountants, and Kirtane & Pandit
LLP, Chartered Accountants, Joint Statutory Auditors,
in their reports dated May 05, 2026, on the Financial
Statements of the Company for FY 2025-26.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of
the Act and the Companies (Appointment and
Remuneration of Managerial Personnel) Rules,
2014, the shareholders of the Company at the
45^th AGM approved the appointment of SIUT & Co
LLP, Company Secretaries (Firm Registration No.
L2021MH011500) to conduct the Secretarial Audit
for a period of 5 (five) years from FY 2025-26 till and
including FY 2029-30.

The Secretarial Audit Report for the FY 2025-26
confirms that the Company has complied with the
provisions of the Act, the rules thereunder, SEBI Listing
Regulations and Guidelines and that the report does
not contain any qualification, reservation, adverse
remark, or disclaimer. The Secretarial Audit Report in
the format given in Form No. MR-3, for the financial
year ended March 31, 2026, is annexed herewith and
marked as an Annexure-3.

COST AUDITORS:

Being an NBFC, maintenance of cost records and
requirement of cost audit as prescribed under
the provisions of Section 148(1) of the Act are not
applicable in respect of the business activities carried
out by the Company.

SECRETARIAL STANDARDS:

The applicable Secretarial Standards, i.e. SS-1 and
SS-2, relating to ‘Meetings of the Board of Directors'
and ‘General Meetings' respectively, have been duly
complied by your Company.

BUSINESS RESPONSIBILITY AND

SUSTAINABILITY REPORT:

Environment, Social and Governance Practices
(“ESG”) is a critical area of focus. Your Company
has constituted ESG Committee and adopted
the Environmental and Social Governance Policy
& Governance Framework. As a responsible
organization your Company takes various
measures to mitigate our negative impact on the
environment, ensure our conduct is responsible
towards our internal and external stakeholders and
invest in good governance practices. Our various
efforts towards responding to the stakeholder
needs and concerns are addressed in the Business
Responsibility and Sustainability Report (“BRSR”),
covering the nine principles of National Guidelines
on Responsible Business Conduct issued by MCA.

The BRSR provides an avenue for disclosing
an overview of the entity's material ESG risks

and opportunities, goals and targets related to
sustainability and performance against them. As per
Regulation 34 of the SEBI Listing Regulations, BRSR
for FY 2025-26 forms part of this Report.

RBI GUIDELINES:

The Company continues to fulfil all the norms and
standards laid down by RBI pertaining to non¬
performing assets, capital adequacy, statutory
liquidity assets, etc. As against the RBI norm of 15%
on a standalone basis, the CRAR as of March 31, 2026,
was 16.83%.

In line with the RBI guidelines for ALM system for
NBFCs, the Company has an ALCO, which meets
quarterly to review its ALM risks and opportunities.
The primary goal of ALM is to effectively manage
risks such as liquidity risk and interest rate risk within
the broader risk management framework, which
incorporates both internal limits and regulatory
tolerance thresholds. The ALM policy aims to establish
a comprehensive framework and define early warning
signals for both short-term and long-term actions to
be taken.

The RBI has implemented the Reserve Bank of India
(Non-Banking Financial Companies - Asset Liability
Management) Directions, 2025 wherein Chapter III -
Liquidity Coverage Ratio (“LCR”) therein is applicable
to NBFCs except (“LRM Framework”). Under this LRM
Framework, all non-deposit taking NBFCs with an
asset size below I 5,000 Crore. The LCR is a measure
of an entity's stock of high quality liquid assets
divided by its total net cash outflows over the next 30
(thirty) calendar days. As at March 31, 2026, the LCR
of the Company was 181% well above the regulatory
limits, reflecting strong liquidity position and balance
sheet resilience.

The Company continues to be in compliance with
the Reserve Bank of India (Non-Banking Financial
Companies - Prudential Norms on Capital Adequacy)
Directions, 2025.

CORPORATE GOVERNANCE:

Our Board presently consists of 10 (ten) Directors. In
compliance with the requirements of the SEBI Listing
Regulations, our Board consists of five Independent
Directors. Our Company is in compliance with
the requirements of the applicable regulations,
including the SEBI Listing Regulations, the Act and
the SEBI ICDR Regulations, in respect of corporate
governance, including constitution of our Board
and Committees thereof. The corporate governance

framework is based on an effective independent
Board, separation of our Board's supervisory role from
the executive management team and constitution
of our Board Committees, as required under law.
Our Board has been constituted in compliance
with the Companies Act, 2013, and the SEBI Listing
Regulations. Our Board functions either as a full
Board or through various Committees constituted to
oversee specific functions. Our Company's executive
management provides our Board with presentations
on its performance periodically.

The Company is committed to achieving and adhering
to the highest standard of Corporate Governance. It
believes in and practices good corporate governance.
The Company maintains transparency and also
enhances corporate accountability. In terms of
Regulation 34 read with Schedule V of SEBI Listing
Regulations the following forms part of this Report
and as required under the Reserve Bank of India
(Non-Banking Financial Companies - Governance)
Directions, 2025, forms part of this Annual Report.
Further, the additional disclosure requirements for
NBFCs in accordance with the aforesaid RBI Directions
forms part of the Corporate Governance Report.:

a. Declaration signed by the Managing Director &
Chief Executive Officer regarding compliance
to Code of Conduct by the Board Members
and SMP;

b. A certificate from a Practicing Company Secretary
that none of the directors on the Board of the
Company have been debarred or disqualified
from being appointed or continuing as directors
of Companies by the Board/MCA or any such
statutory authority;

c. Report on the Corporate Governance; and

d. Practicing Company Secretaries certificate
regarding compliance of conditions of
Corporate Governance.

CONSERVATION OF ENERGY, TECHNOLOGY
ABSORPTION, FOREIGN EXCHANGE EARNINGS
AND OUTGO:

Conservation of Energy:

The operations of the Company are not energy
intensive. The Company implements various energy
conservation measures across all its functions, which
are highlighted in the BRSR which is annexed to
this Report.

Steps taken/impact on conservation of
energy:

The Company has undertaken multiple initiatives to
drive energy efficiency across its operations. Inverter
air conditioners have been installed across 257 new
operational branches (~950 units with a total tonnage
of 1281 TR). This transition from conventional ACs has
resulted in an estimated savings of ~5.05 lakh units of
electricity, translating to cost savings and a reduction
of ~354 tonnes of CO₂ emissions in a year.

Additionally, the Company has initiated installation
of LED lights in new and upcoming branches.
Installation of LED lights across new branches (4,158
units of 15W, 20W and 36W) has led to cost savings
and a reduction of ~26792 tonnes of CO2 emissions
in a year.

Steps taken for utilising alternate sources of
energy:

The adoption of green sourced energy at the corporate
office reflects the Company's commitment towards
alternative and sustainable energy sources.

Capital investment in energy conservation
equipment:

The Company has invested approximately net
cost of H 12.57 Lakh in energy-efficient inverter
air conditioning units and H 10.55 Lakh in LED
lighting systems.

Technology Absorption:

The details pertaining to technology absorption at
the Company (usage of digital and data analytics to
build sustainable competitive advantage) have been
explained in the "Information Technology” section
and the "Management Analysis and discussion”
of this Report. Considering the nature of services
and businesses, no specific amount of expenditure
is earmarked for Research and Development.
However, the Company on an ongoing basis strives
for various improvements in the products, platforms,
and processes.

Foreign Exchange Earnings and Outgo:

During FY 2025-26, there were no foreign exchange
earnings (previous year: NIL) and the foreign exchange
outgo in terms of actual outflow amounted to H 7.71
Crore (previous year: H 3.71 Crore).

OTHER DISCLOSURES:

a. During the year, there was no application made
or any proceeding pending under the Insolvency
and Bankruptcy Code, 2016 and any one-time
settlement with any bank or financial institution
during the year under review and hence the
details of difference between amount of the
valuation done at the time of one time settlement
and the valuation done while taking loan from
the Banks or Financial Institutions along with the
reasons thereof is not applicable.

b. The Company has not defaulted in repayment of
loans from banks and financial institutions;

c. There were no delays or defaults in payment of
interest/principal of any of its debt securities;

d. There was no raising of funds through rights issue.

e. The Company has not entered into any
agreements as required to be disclosed under
Clause 5A of Paragraph A of Part A of Schedule III
of SEBI Listing Regulations.

f. Disclosures pursuant to Reserve Bank of
India (Non-Banking Financial Companies -
Governance) Directions, 2025, unless provided in
the Board's Report, form part of the notes to the
standalone financial statements;

ANNUAL RETURN:

Pursuant to Section 92 and Section 134(3) of the
Act read with the Companies (Management and
Administration) Rules, 2014 as amended from time
to time, the Annual Return is available at the website
of the Company athttps://poonawallafincorp.com/
investor-financials.

PARTICULARS OF EMPLOYEES AND RELATED
DISCLOSURES:

The information required under Section 197(12) of the
Act read with Rule 5 of the Companies (Appointment
and Remuneration of Managerial Personnel) Rules,
2014, is disclosed in this report as Annexure 4.

In terms of the second proviso to Section 136(1)
of the Act, the Report is being sent to all Members,
excluding the statement with respect to employees
employed throughout the year and employees

employed for part of the year who were in receipt
of remuneration in excess of limits prescribed under
Section 197 (12) of the Act read with Rule 5(2) and (3)
of the Companies (Appointment and Remuneration
of Managerial Personnel) Rules, 2014. It is to be noted
that the Board's Report is abridged to that extent and
all other information as required under applicable law
form part of this Report. The statement is available for
inspection by any Member on request. Any Member
interested in obtaining a copy of the said statement,
may write an email to the Company Secretary at
secretarial@poonawallafincorp.com

TRANSFER WOF AMOUNT TO INVESTOR
EDUCATION AND PROTECTION FUND:

Pursuant to Section 124(5) of the Act read with
Investor Education and Protection Fund Authority
(Accounting, Audit, Transfer and Refund) Rules, 2016,
as amended from time to time ("IEPF Rules”) relevant
amount, which remained unpaid or unclaimed for a
period of 7 (seven) years have been transferred by
the Company, from time to time on due dates, to
the Investor Education and Protection Fund ("IEPF”).
During the year under review, your Company has
transferred H 3,09,720/- (Rupees Three Lakh Nine
Thousand Seven Hundred and Twenty Only) to
IEPF Authority.

Pursuant to Section 124 (6) of the Act and read with
Rule 6 of IEPF Rules, all the underlying shares in
respect of which dividends are not claimed/paid for
the last seven consecutive years, or more are liable
to get transferred to the IEPF Authority. Accordingly,
during the year under review 20,622 equity shares
of face value of H 2/- each were transferred to
IEPF Authority.

The Company has uploaded the details of
unpaid and unclaimed amounts lying with
the Company and also the details of equity
shares transferred to IEPF Authority on the
Company's websitehttps://poonawallafincorp.
com/investor-infoand also on the MCA's website
(www.mca.gov.in).

FRAUD MONITORING AND REPORTING:

A dedicated Fraud Control Unit and fraud risk
framework deploys real-time analytics, anomaly
detection, and coordinated investigations, with
oversight by Committee of the Executives (COE)
constituted in accordance with the Master Directions
on Fraud Risk Management in Non-Banking
Financial Companies (NBFCs) (including Housing
Finance Companies) issued by RBI and the ACB. The
COE meets on a quarterly basis, and details of their
meetings and terms of reference are set out in the
Corporate Governance Report.

During the year under review, neither the Joint
Statutory Auditors nor the Secretarial Auditor has
reported to the ACB under Section 143 (12) of Act, any
instances of fraud committed against the Company
by its officers or employees, the details of which need
to be mentioned in the Board's Report.

APPRECIATION:

Your directors would like to record their appreciation
of the hard work and commitment of the Company's
employees and warmly acknowledge the unstinting
support extended by their banks, financial institutions,
rating agencies, shareholders and other stakeholders
in contributing to the results. Your directors also
express their gratitude for the guidance received
from RBI, SEBI and other regulatory agencies.

For and on behalf of the Board

Arvind Kapil Sunil Samdani

Managing Director & Executive Director

Chief Executive Officer DIN: 10301175

DIN:10429289

Place: Mumbai Mumbai

Date: May 05, 2026 Date: May 05, 2026