Aadhar Housing Finance Ltd. ಖಾತೆಯ ಉಪಯುಕ್ತ ಮಾಹಿತಿ

Mar 31, 2026

2.19 Provisions, contingent liabilities and
contingent assets

• Provisions are recognised only when an entity
has a present obligation (legal or constructive)
as a result of a past event; and

• it is probable that an outflow of resources
embodying economic benefits will be required
to settle the obligation; and

• a reliable estimate can be made of the amount
of the obligation

Provision is measured using the cash flows
estimated to settle the present obligation and when
the effect of time value of money is material, the
carrying amount of the provision is the present value
of those cash flows. Reimbursement expected in
respect of expenditure required to settle a provision
is recognised only when it is virtually certain that
the reimbursement will be received.

Contingent liability is disclosed in case of:

• a possible obligation arising from past events and
whose existence will be confirmed only by the
occurrence or non-occurrence of one or more
uncertain future events not wholly within the
control of the entity;

• a present obligation arising from past events, when
it is not probable that an outflow of resources will
be required to settle the obligation; and

• a present obligation arising from past events,
when no reliable estimate is possible.

Where the unavoidable costs of meeting the
obligations under the contract exceed the economic
benefits expected to be received under such
contract, the present obligation under the contract
is recognised and measured as a provision.

Contingent assets:

Contingent assets are not recognised. A contingent
asset is disclosed, as required by Ind AS 37, where
an inflow of economic benefits is probable.

Provisions, contingent liabilities and contingent
assets are reviewed at each Balance Sheet date.

2.20 Commitments

Commitments are future liabilities for contractual
expenditure, classified and disclosed as follows:

• estimated amount of contracts remaining to be
executed on capital account and not provided for;

• other non-cancellable commitments, if any, to the
extent they are considered material and relevant
in the opinion of management.

2.21 Non-current assets held for sale

Non-current assets are classified as held for sale if
their carrying amount is intended to be recovered
principally through a sale (rather than through
continuing use) when the asset is available for
immediate sale in its present condition subject only
to terms that are usual and customary for sale of
such asset and the sale is highly probable and is
expected to qualify for recognition as a completed
sale within one year from the date of classification.

Non-current assets classified as held for sale are
measured at lower of their carrying amount and fair
value less costs to sell.

2.22 Exceptional items

An item of income or expense which its size, type or
incidence requires disclosure in order to improve an
understanding of the performance of the Company
is treated as an exceptional item and the same is
disclosed in the notes to accounts.

2.23 Statement of cash flows

Statement of cash flows is prepared segregating the
cash flows into operating, investing and financing
activities. Cash flow from operating activities is
reported using indirect method.

Cash and cash equivalents (including bank
balances) shown in the statement of cash flows
exclude items which are not available for general
use as on the date of Balance Sheet.

3. Critical accounting judgements
and key sources of estimation
uncertainties

The preparation of the financial statements in
conformity with Ind AS requires the Management
to make estimates and assumptions considered
in the reported amounts of assets and liabilities
(including contingent liabilities) and the reported

income and expenses during the year. The
Management believes that the estimates used in
preparation of the financial statements are prudent
and reasonable.

Future results could differ due to these estimates
and the differences between the actual results and
the estimates are recognised in the periods in which
the results are known / materialise.

Expected credit loss

When determining whether the risk of default on
a financial instrument has increased significantly
since initial recognition, the Company considers
reasonable and supportable information that is
relevant and available without undue cost or effort.
This includes both quantitative and qualitative
information and analysis, based on the Company''s
historical experience and credit assessment and
including forward-looking information. In certain
cases, the assessment based on past experience
is required for future estimation of cash flows which
requires significant judgment.

The inputs used and process followed by the
Company in determining the increase in credit risk
have been detailed in note 39.

Effective Interest Rate (EIR)

The Company''s EIR methodology, recognises
interest income using a rate of return that represents
the best estimate of a constant rate of return over
the expected behavioural life of loans given.

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

Share-based payments

Estimating fair value for share-based payment
transactions requires use of an appropriate
valuation model. The Company measures the cost
of equity-settled transactions with employees using
Black-Scholes Model to determine the fair value of
the options on the grant date.

Inputs into the valuation model, includes assumption
such as the expected life of the share option,
volatility and dividend yield.

Further details used for estimating fair value for
share-based payment transactions are disclosed
in note 43.

Following abbreviation to be read as :

''ESOP'' - Employee Stock Option Plan

''ESAR'' - Employee Stock Appreciation Rights

Business model assessment

The Company''s business model objective is to hold
financial assets in order to collect contractual cash
flows. The contractual terms of the financial asset
give rise to cash flows that are solely payments
of principal and interest on the principal amount
outstanding on specified dates, accordingly entire
Loan Portfolio is classified at amortised cost.

Net gain on derecognition of financial
instruments under amortised cost
category

The Company sells / transfers the portfolio through
direct assignment and co-lending. As per para
February 3, 2013 of Ind AS 109, if the transferred
asset is part of a larger financial asset (e.g., when
an entity transfers interest cash flows that are part
of a debt instrument, see paragraph 3.2.2(a)) and
the part transferred qualifies for derecognition in its
entirety, the previous carrying amount of the larger
financial asset shall be allocated between the part
that continues to be recognised and the part that
is derecognised, on the basis of the relative fair
values of those parts on the date of the transfer.
For this purpose, a retained servicing asset shall be
treated as a part that continues to be recognised.
The difference between:

(a) the carrying amount (measured at the date
of derecognition) allocated to the part
derecognised and

(b) the consideration received for the part
derecognised (including any new asset
obtained less any new liability assumed)
shall be recognised in profit or loss.

While calculating the fair value of the part continued
to be recognised, the Company makes estimates of
net present value of future cash flows of spreads
it will earn. That estimate includes the assumption
around expected life, servicing liabilities and net
yield it expects to earn in future.

New and amended standards

The Company applied for the first-time certain
standards and amendments, which are effective for
annual periods beginning on or after April 1, 2025.
The Company has not early adopted any standard,
interpretation or amendment that has been issued
but is not yet effective.

(i) Amendments to Ind AS 21 - Lack of
exchangeability

The Ministry of Corporate Affairs (MCA) notified
the Companies (Indian Accounting Standards)
Amendment Rules, 2025, which amend Ind AS
21, The Effects of Changes in Foreign Exchange
Rates to specify how an entity should assess
whether a currency is exchangeable and how
it should determine a spot exchange rate when
exchangeability is lacking. The amendments also
require disclosure of information that enables users
of its financial statements to understand how the
currency not being exchangeable into the other
currency affects, or is expected to affect, the
entity''s financial performance, financial position
and cash flows.

The amendments are effective for annual
reporting periods beginning on or after
April 01, 2025. When applying the amendments,
an entity cannot restate comparative information.

The amendments do not have a material impact
on the Company''s financial statements.

(ii) Amendments to Ind AS 1 - Classification of
Liabilities as Current or Non-current and
Non-current Liabilities with Covenants

In August 2025, the MCA notified amendments
to paragraphs 69 to 76 of Ind AS 1 to specify the
requirements for classifying liabilities as current or
non-current. The amendments clarify:

• What is meant by a right to defer settlement

• That a right to defer must exist at the end of the
reporting period

• That classification is unaffected by the likelihood
that an entity will exercise its deferral right

• That only if an embedded derivative in a
convertible liability is itself an equity instrument
would the terms of a liability not impact
its classification

In addition, a requirement has been introduced to
require disclosure when a liability arising from a
loan agreement is classified as non-current and
the entity''s right to defer settlement is contingent
on compliance with future covenants within
twelve months.

If there is a breach of a material covenant of a
long term loan arrangement on or before the end
of the reporting period, resulting in the liability
becoming payable on demand as at the reporting
date, and the lender agrees—after the reporting
period but before the financial statements are
approved for issue—not to demand repayment
for at least 12 months as a consequence of the
breach, this shall be treated as an adjusting
event. Accordingly, the entity is not required to
classify the liability as current.

The amendments are effective for annual
reporting periods beginning on or after
April 01, 2025 retrospectively in accordance with
Ind AS 8.

The Company has reviewed the amendment
and based on its evaluation, it has determined
that it does not have any impact in its
financial statements.

(iii) Amendments to Ind AS 7 and Ind AS 107 -
Supplier Finance Arrangements

In August 2025, the MCA notified amendments
to Ind AS 7 Statement of Cash Flows and Ind
AS 107 Financial Instruments: Disclosures to
clarify the characteristics of supplier finance
arrangements and require additional disclosure of
such arrangements. The disclosure requirements
in the amendments are intended to assist users of
financial statements in understanding the effects
of supplier finance arrangements on an entity''s
liabilities, cash flows and exposure to liquidity risk.

The Company has not entered into supplier finance
arrangements in the current financial year and
accordingly, the amendment to this standard does
not have any impact on the financial statements.

(iv) International Tax Reform-Pillar Two
Model Rules - Amendments to Ind AS 12

In August 2025, the MCA notified amendments to
Ind AS 12 Income Taxes in response to the OECD''s
BEPS Pillar Two rules and include:

• A mandatory temporary exception to the
recognition and disclosure of deferred taxes
arising from the jurisdictional implementation of
the Pillar Two model rules; and

• Disclosure requirements for affected entities
to help users of the financial statements better
understand an entity''s exposure to Pillar Two
income taxes arising from that legislation,
particularly before its effective date.

The mandatory temporary exception - the use
of which is required to be disclosed - applies
immediately. The remaining disclosure requirements
apply for annual reporting periods beginning on or
after April 01, 2025, but not for any interim periods
ending on or before March 31, 2026.

The amendments have no impact on the Company''s
financial statements as the Company is not in scope
of the Pillar Two model rules.

Standards notified but not yet effective

The amendments to the standards that are notified
by the Ministry of Corporate Affairs (MCA), but
not yet effective, up to the date of issuance of
the Company''s financial statements are disclosed
below. The Company will adopt these amendments
to the standards, when they become effective.

(i) Amendments to Ind AS 1 - Classification of
Liabilities as Current or Non-current and
Non-current Liabilities with Covenants
and Ind AS 10 Events after the Reporting
Period

Ind AS 10 has been amended to remove the
previous treatment under which a lender''s post
reporting date waiver—granted before the financial
statements were approved for issue—of a breach of
a material covenant in a long term loan arrangement
that occurred on or before the end of the reporting
period, resulting in the liability becoming payable
on demand at the reporting date, was regarded as
an adjusting event (Refer note 2.3).

For annual reporting periods beginning on or after
April 01, 2026, any breach of a covenant—whether
material or immaterial—occurring on or before the
reporting date will, in accordance with Ind AS 1,
require the related liability to be classified as
current, unless the lender has granted a waiver of
the breach on or before the reporting date and has
agreed not to demand repayment for at least 12
months after the reporting date as a consequence
of the breach. Such a waiver shall be treated as an
adjusting event.

The amendments are effective for annual reporting
periods beginning on or after April 01, 2026
retrospectively in accordance with Ind AS 8.

i) All Housing and other loans are originated in India.

ii) Loans granted by the Company are secured by equitable mortgage/ registered mortgage of the property and
assets financed and/or undertaking to create a security and/or assignment of Life Insurance Policies and/or
personal guarantees and/or hypothecation of assets and are considered appropriate and good.

iii) The Company has assigned and colent pool of certain housing and property loans and managed servicing of
such loan accounts. The balance outstanding in the pool, as at the reporting date aggregates 15,64,482 lakh
(March 31, 2025: 14,95,374 lakh). The carrying value of these assets have been de-recognised in the books of
the Company.

iv) There is no outstanding loan to Public Sector.

v) There were no loans given against the collateral of gold jewellery and hence the percentage of such loans to
the total outstanding asset is Nil (March 31, 2025 : Nil).

vi) Housing loan and other property loan includes 129,578 lakh (March 31, 2025: 126,300 lakh) given to employees
of the Company under the staff loan.

vii) Housing loan and other property loan includes 19,972 lakh (March 31, 2025: 15,718 lakh) in respect of properties
held for or under disposal under Securitisation and Reconstruction of Financial Assets and Enforcement of
Security Interest Act, 2002.

viii) Impairment loss allowance includes a management overlay of 15,734 lakh (March 31, 2025: 15,851 lakh) based
on a qualitative assessment of the loan portfolio.

a) Based on and to the extent of information received by the Company from the suppliers regarding their status under
the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act) and relied upon by the auditors.
There are no overdue amounts to Micro, Small and Medium Enterprises as at March 31, 2026 and
March 31,2025 for which disclosure requirements under Micro, Small and Medium Enterprises Development
Act, 2006 are applicable.

b) Trade Payables ageing schedule

*Floating rate linked to RBI repo, MIOIS and SBI MCLR

#Publicly issued NCD

iii) The Company has raised 140,000 lakh (March 31, 2025 : 11,05,180 lakh) from Secured Redeemable Non
Convertible Debentures (NCDs) during the year ended March 31, 2026. NCDs are long term and are secured by
way of pari passu first charge by way of (present & future obligations) hypothecation on standard book debts /
receivables/ outstanding moneys, current assets, Cash & Bank balances & Investments as per contracted terms
except for those book debts/ receivables charged or to be charged in favour of NHB for refinance availed or to
be availed from them and the Company has provided Security on specific immovable property on certain series
of NCDs private placement (excluding IPO Series). NCDs including current maturities are redeemable at par in
various periods.

iv) The Company has not defaulted in the repayment of debt securities and interest thereon for the year ended
March 31, 2026 and March 31, 2025.

v) There has been no deviation in the utilisation of issue proceeds of publically issued secured redeemable NCD,
from the Objects as stated in the Shelf prospectus document dated September 3, 2018.

Maturity profile disclosed above excludes EIR adjustments amounting to 11,417 lakh (March 31, 2025 :

11,317 lakh).

iii) The secured term loans from banks are availed from various scheduled banks. These loans are repayable as
per the individual contracted terms in one or more instalments between April 2026 and January 2040. These
loans are secured / to be secured by way of jointly ranking pari passu inter-se charge, along with NHB and NCD
holders, on the Company''s book debts, housing loans and the whole of the present and future movable assets
of the Company as applicable.

iv) Secured term loan from National Housing Bank are repayable as per the contracted terms in one or more
instalments between April 2026 and January 2036. These loans from National Housing Bank are secured / to
be secured by way of first charge to and in favour of NHB, other banks and NCD holders and jointly ranking pari
passu inter-se, on the Company''s book debts, housing loans and the whole of the present and future movable
and immovable assets wherever situated excluding SLR assets.

v) Cash credit facilities from banks are secured by way of jointly ranking pari passu inter-se charge, along with
NHB and NCD holders, on the Company''s book debts, housing loans and the whole of the present and future
movable assets of the Company as applicable. All cash credit facilities are repayable as per the contracted /
rollover term.

vi) The Company has not defaulted in the repayment of borrowings (other than debt securities) and interest thereon
for the year ended March 31, 2026 and March 31, 2025.

vii) External Commercial Borrowings from bank is availed from GIFT City which is considered outside India for
reporting purposes. These loans are repayable as per the individual contracted terms in one or more instalments
between March 2027 and March 2030. These loans are secured / to be secured by way of jointly ranking pari
passu inter-se charge, along with NHB and NCD holders, on the Company''s book debts, housing loans and the
whole of the present and future movable assets of the Company as applicable.

The National Housing Bank Directives requires all HFCs, accepting public deposits, to create a floating charge on the
statutory liquid assets maintained in favour of the depositors through the mechanism of a Trust Deed. The Company
has accordingly appointed SEBI approved Trustee Company as a Trustee for the above by executing a trust deed.
The public deposits of the Company as defined in paragraph 2(1)(y) of the Housing Finance Companies (NHB)
Directions, 2010, are secured by floating charge on the Statutory Liquid Assets maintained in terms of sub-sections
(1) and (2) of Section 29B of the National Housing Bank Act, 1987.

Maturity profile disclosed above excludes EIR adjustments amounting to 18 lakh (March 31, 2025: 123 lakh).

iii) Unsecured Redeemable Non-Convertible Debentures are subordinated to present and future senior
indebtedness of the Company. These Unsecured Redeemable Non-Convertible Debentures qualifies as Tier II
capital in accordance with National Housing Bank (NHB) guidelines for assessing capital adequacy based on
balance term to maturity. These debentures are redeemable at par on maturity at the end of various periods.

b) Terms / Rights attached to equity shares

The Company has only one class of equity shares having a par value of 110 per share. Each holder of equity
shares is entitled to one vote per share. In the event of liquidation of the Company, the holders of equity shares
will be entitled to receive the remaining assets of the Company, after distribution of all preferential amounts. The
distribution will be in proportion to the number of equity shares held by the share holders. Dividend declared
towards equity shares will be subject to the approval of shareholder in the ensuing Annual General Meeting.''

c) The Company has made an Initial Public Offer (IPO) for 9,52,55,598 equity shares aggregating to 1300,000
lakh of which 6,34,92,063 equity share aggregating to 2,00,000 lakh were offered by selling shareholder and
3,17,63,535 equity shares aggregating to 1100,000 lakh at the face value of 110 each at a premium of 1305 per
equity share (excluding discount of 123 per share on employee reservation portion of 2,39,726 equity shares)
by way of fresh issue of the equity shares on May 13, 2024. The Company''s equity share got listed on National
Stock Exchange of India Limited (NSE) and BSE Limited (BSE) on May 15, 2024.

d) The shareholders vide a special resolution have approved bonus issue of 35,52,79,473 equity shares of the
Company in the ratio of nine shares of face value of 110 each for each existing equity share of the face value
of 110 each on January 16, 2021 in extraordinary general meeting (EGM).

e) The Company has not bought back any class of shares.

f) The Company has not allotted any class of shares as fully paid up pursuant to contract without payment being

received in cash.

g) The Company has not proposed any dividend during the year ended March 31, 2026 and March 31, 2025.

h) Details of shareholders holding more than five percent equity shares in the Company are as under:

25 (a). Nature and Purpose of Reserves:

i. Capital reserve on Amalgamation - This reserve is created on account of merger of Aadhar Housing Finance
Limited into DHFL Vysya Housing Finance Limited.

ii. Securities Premium - Securities premium account is used to record premium on issue of shares. The reserve
is utilised in accordance with the provisions of Companies Act, 2013.

iii. Statutory Reserve - Section 29C (i) of the National Housing Act, 1987 defines that every housing finance
institution which is a Company shall create a reserve fund and transfer therein a sum not less than twenty
percent of its net profit every year as disclosed in the statement of profit and loss before any dividend is
declared. For this purpose any special reserve created by the Company under Section 36(1)(viii) of the
Income Tax Act 1961, is considered to be an eligible transfer. During the year ended March 31, 2026,
the Company has transferred an amount of 118,355 lakh [P.Y. 118,243 lakh] to special reserve in terms
of Section 36(1)(viii) of the Income Tax Act 1961 and has been considered eligible for statutory reserve
u/s 29C of the National Housing Bank Act, 1987. In addition, the Company has transferred an amount of
13,555 lakhs [P.Y. Nil] to statutory reserve.

iv. Debenture Redemption reserve - This reserve is created while issuing Debentures with an objective to
reduce the risk of default in repayments of debentures. The Company has created debenture redemption
reserve towards its public issue of Secured Redeemable Non-convertible Debentures.

v. Employee Stock Option Outstanding - This reserve relates to stock option granted by the Company to
employees under various ESOP schemes.

vi. Items of other comprehensive income :- a) Remeasurement of defined benefit liability/ asset - This
represents the acturial gain / (loss) on employee benefit plans.

(b). Effective portion of cash flow hedge reserve - It represents the cumulative gains/(losses) arising on revaluation

of the derivative instruments designated as cash flow hedges through OCI.

The Company is also involved in other law suits, claims, investigations and proceedings, including collection and
repossession related matters, which arise in the ordinary course of business. However, there are no significant claims
on such cases. Future cash outflows in respect of the above, if any, is determinable only on receipt of judgement
/decisions pending with the relevant authorities.

Part of the aforementioned contingent liabilities towards income tax and indirect tax have been paid under protest.

»5 Commitments

i. Estimated amount of contracts remaining to be executed on capital account including intangible asset
(net of advances) and not provided for as at March 31, 2026 11,611 lakh (March 31, 2025 1735 lakh).

37 Financial instruments

(i) Fair value hierarchy

The Company uses the following hierarchy to determine the fair values of its financial instruments that are (a)
recognised and measured at fair value and (b) measured at amortised cost and for which fair values are disclosed
in the financial statements:

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity
instruments and mutual funds that have quoted price. The fair value of all equity instruments which are traded in the
stock exchanges is valued using the closing price as at the reporting period. The mutual funds are valued using the
closing NAV.

Level 2: The fair value of financial instruments that are not traded in an active market (for example, traded bonds,
over-the- counter derivatives) is determined using valuation techniques which maximise the use of observable
market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value
an instrument are observable, the instrument is included in level 2.

Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in
level 3. This is the case for unlisted equity securities, contingent consideration and indemnification asset included
in level 3.

There were no transfers between levels 1, 2 and 3 during the year.

The Company recognises transfers in and transfers out of fair value hierarchy levels as at the end of the reporting period.

(ii) Valuation process

The management of the Company performs the valuations of financial assets and liabilities required for financial
reporting purposes.

The carrying amounts of trade receivables, trade payables, capital creditors and cash and cash equivalents are
considered to be the same as their fair values, due to their short-term nature.

The fair values for loans are calculated based on cash flows discounted using a current lending rate. They are
classified as level 3 fair values in the fair value hierarchy due to the inclusion of unobservable inputs including
counterparty credit risk.

39 Financial risk management

a. Liquidity Risk

Liquidity risk is the current and prospective risk arising out of an inability to meet financial commitments as they
fall due, through available cash flows or through the sale of assets at fair market value. It includes both, the risk of
unexpected increases in the cost of funding an asset portfolio at appropriate maturities and the risk of being unable
to liquidate a position in a timely manner at a reasonable price.

The Company manages liquidity risk by maintaining sufficient cash and marketable securities and by having access to
funding through an adequate amount of committed credit lines. Given the need to fund diverse products, the Company
maintains flexibility in funding by maintaining availability under committed credit lines to meet obligations when due.
Management regularly monitors the position of cash and cash equivalents vis-a-vis projections. Assessment of
maturity profiles of financial assets and financial liabilities including debt financing plans and maintenance of Balance
Sheet liquidity ratios are considered while reviewing the liquidity position.

Liquidity risk is managed in accordance with our Asset Liability Management Policy. This policy is framed as per
the current regulatory guidelines and is approved by the Board of Directors. The Asset Liability Management Policy
is reviewed periodically to incorporate changes as required by regulatory stipulation or to realign the policy with
changes in the economic landscape. The Asset Liability Committee (ALCO) of the Company formulates and reviews
strategies and provides guidance for management of liquidity risk within the framework laid out in the Asset Liability
Management Policy. The table below summarises the maturity profile of the undiscounted cash flows of the Company''s
financial liabilities.

b. Interest Risk

The core business of the company is providing housing and other mortgage loans. The company borrows through
various financial instruments to finance its core lending activity. These activities expose the company to interest
rate risk.

Interest rate risk is measured through earnings at risk from an earnings perspective and through duration of equity
from an economic value perspective. Further, exposure to fluctuations in interest rates is also measured by way of
gap analysis, providing a static view of the maturity and re-pricing characteristic of Balance sheet positions. An
interest rate sensitivity gap report is prepared by classifying all rate sensitive assets and rate sensitive liabilities into
various time period categories according to contracted/behavioural maturities or anticipated re-pricing date. The
difference in the amount of rate sensitive assets and rate sensitive liabilities maturing or being re-priced in any time
period category, gives an indication of the extent of exposure to the risk of potential changes in the margins on new
or re-priced assets and liabilities. The interest rate risk is monitored through above measures on a quarterly basis.

The Company has USD denominated liability (External commercial borrowings) at floating rate of interest causing
volatility in the cash flow arising on principal and interest repayment. Management aims to hedge the volatility with
appropriate derivative instruments. Accordingly, the company entered into foreign currency forwards and cross
currency interest rate swaps with tenor and maturity matching with the underlying cashflow.

Interest Rate Sensitivity

The following table demonstrates the net sensitivity to a reasonably possible change in interest rate (all other
variables being constant) of the Company''s statement of profit and loss (before taxes) and equity

c. Price risk

The Company''s exposure to price risk is not material and it is primarily on account of investment of temporary
treasury surplus in the highly liquid debt funds for very short durations. The Company has a board approved policy
of investing its surplus funds in highly rated debt mutual funds and other instruments having insignificant price risk,
not being equity funds/ risk bearing instruments.

d. Market risk

Market risk arises from fluctuation in the fair value of future cash flow of financial instruments due to changes in
the market variables such as interest rates, foreign exchange rates and equity prices. Market risk for the Company
encompasses exposures to equity investments, changes in exchange rates, interest rate risks on investment
portfolios as well as the floating rate assets and liabilities with differing maturity profiles. Generally the borrowing
are denominated in currencies that match the cash flows generated by the underlying operations of the company
- primarily (1). In case where borrowings are denominated in foreign currency, the company uses derivative to
manage the risk. All such transactions are carried out within guidelines set out Asset & liability committee (ALCO).
The Company has applied hedge accounting to manage volatility in profit and loss.

e. Currency risk

The Company is exposed to foreign currency fluctuation risk for its external commercial borrowing (ECB). The
Company has hedged the entire ECB exposure for the full tenure as per Board approved Foreign Exchange Risk
Management policy. The Company has entered into foreign currency forwards and cross currency interest rate swaps
with strategy which aims to hedge a defined portion of the exposure to USD-1 exchange rate volatility on borrowings
and interest repayable in USD. The Company evaluates the foreign currency exchange rates, tenure of ECB and its
fully hedged costs for raising ECB. The Company manages its currency risks by entering into over the counter (OTC)
derivatives contracts as hedge positions and the same are being governed through the Board approved Foreign
Exchange Risk Management Policy.

Hedging policy

The Company''s hedging policy only allows for the effective hedging relationships to be considered as hedges as per
the relevant Ind AS. Hedge effectiveness is determined at the inception of the hedge relationship and through the
periodic prospective effectiveness assessments to ensure that the economic relationship exists between the hedged
item and hedging instrument. The Company enters into hedge relationships where the critical terms of the hedging
instrument match with the terms of hedged item and so a qualitative and quantitative assessment of effectiveness
is performed.

Hedge Ratio:

There is an economic relationship between the hedged item and the hedging instrument as the terms of the foreign
currency forward contracts and cross currency interest rate swaps contracts match that of the foreign currency
borrowings. The Company has established a hedge ratio of 1:1 for the hedging relationships as the underlying risk
of the foreign currency forward and cross currency interest rate swaps are identical to the hedged risk components.
The Company has entered into 100% cash flow contracts towards principal and interest denominated in USD into
fixed amount of INR. Accordingly, hedge relationship is effective. The hedge ineffectiveness can arise mainly if there
is a change in the credit risk of the Company or the counterparty.

f. Credit risk

Credit risk is the risk of loss that may occur from the failure of any party to abide by the terms and conditions of any
contract, principally the failure to make required payments of amounts due to the company. In its lending operations,
the Company is principally exposed to credit risk.

The credit risk is governed by the Credit Policy approved by the Board of Directors. The Credit Policy outlines the
type of products that can be offered, customer categories, the targeted customer profile and the credit approval
process and limits.

The Company measures, monitors and manages credit risk at an individual borrower level and at the group exposure
level for corporate borrowers. The credit risk for retail borrowers is being managed at portfolio level for both Home
loans and other property loans. The Company has a structured and standardized credit approval process, which
includes a well-established procedure of comprehensive credit appraisal. The Risk Management Policy addresses
the recognition, measurement, monitoring and reporting of the Credit risk.

Credit Risk Assessment Methodology

Company''s customers for retail loans are primarily lower and middle income, salaried and self-employed individuals.
The loans are secured by the mortgage of the borrowers'' property.

The Company''s credit officers evaluate credit proposals on the basis of operating policies approved by the Board
of Directors. The criteria typically include factors such as the borrower''s income, the loan-to-value ratio and
demographic parameters. Any deviations need to be approved at the designated levels.

External agencies such as field investigation agencies facilitate a comprehensive due diligence process including
visits to offices and homes in the case of loans made to retail borrowers.

Company monitor''s borrower account behaviour as well as static data regularly to monitor the portfolio performance
of each product segment regularly, and use these as inputs in revising its product programs, target market definitions
and credit assessment criteria to meet the twin objectives of combining volume growth and maintenance of
asset quality.

PD - The Probability of Default is an estimate of the likelihood of default over a given time horizon. A default may
only happen at a certain time over the assessed period, if the facility has not been previously derecognised and
is still in the portfolio. The PD has been determined based on seasoned historical portfolio data using the survival
analysis methodology.

EAD - The Exposure at Default includes repayments scheduled by contract or otherwise, expected drawdowns on
committed facilities, accrued interest from missed payments and loan commitments.

LGD - The Loss Given Default is an estimate of the loss arising in the case where a default occurs at a given time.
It is based on the difference between the contractual cash flows due and those that the lender would expect to
receive, including from the realisation of any collateral. It is usually expressed as a percentage of the EAD. The LGD
is determined based on seasoned historical portfolio data.

An analysis of changes in the gross carrying amount (excluding adjustment to carrying value on account of application
of effective interest rate) and the corresponding ECL allowances in relation to lending is, as follows:

a) Housing and Other Loans

The table below shows the credit quality and the exposure to credit risk based on the year-end stage classification.
The amounts presented are gross of impairment allowances.

♦Includes loan assets of 1893 lakhs (0.01%) not more than 90 DPD which have been classified as NPA as per Reserve Bank
of India (Non-Banking Financial Companies - Income Recognition, Asset Classification and Provisioning) Directions, 2025.
[March 31, 2025: 1172 lakhs (0.01%)].

♦♦Includes loan assets of 1769 lakhs (0.01%) not more than 90 DPD which have been classified as NPA as per Reserve Bank
of India (Non-Banking Financial Companies - Income Recognition, Asset Classification and Provisioning) Directions, 2025.
[March 31, 2025: 1156 lakhs (0.01%)]

40 Capital Management

The Company''s objectives when managing capital are to

• safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders
and benefits for other stakeholders, and

• Maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to
shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. The Company monitors
capital on the basis of the following gearing ratio: Net debt (total borrowings net of cash and cash equivalents and
Liquid investments) divided by Total ''equity'' (as shown in the balance sheet) and Capital adequacy ratio.

Reason for Variance in LCR: LCR is decreased in the current year due to higher net cash outflow required in next 30
calendar days.

1. CRAR (Capital Risk Adjusted Ratio) = [Net owned fund and Tier II Capital / Risk Weighted Assets]

2. CRAR (Capital Risk Adjusted Ratio) -Tier I Capital = [Net owned fund / Risk Weighted Assets]

3. CRAR (Capital Risk Adjusted Ratio) -Tier II Capital = [Tier II Capital / Risk Weighted Assets)

4. Liquidity Coverage Ratio = [Stock of High Quality Liquid Assets / Total net cash outflow required in next

30 calendar days]

Liquidity Coverage Ratio requirement applicable to the Company as per Reserve Bank of India (Non-Banking Financial
Companies - Asset Liability Management) Directions, 2025 dated November 28, 2025.

41 Segment reporting

The Company operates only in one Operating Segment i.e Housing Finance business - Financial Services and all
other activities are incidental to the main business activity, hence have only one reportable Segment as per Indian
Accounting Standard 108 ''Operating Segments''. The reportable business segments are in line with the segment
wise information which is being presented to the CODM. The Company has identified Managing Director and CEO
as CODM.

The Company has its operations within India and all revenue is generated within India.

42 Employee benefits

42.1 Defined contribution plan

The Company makes contributions to provident fund for qualifying employees to Regional Provident Fund
Commissioner under defined contribution plan under the Provident Fund Act.

Amount recognised as an expense and included under the head ''Contribution to Provident and Other Funds''
of Statement of Profit and Loss are as follows:

42.2 Defined obligation benefit

The Company provides gratuity to its employees which are defined benefit plan. The present value of obligation is
determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of
service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build
up the final obligation.

The gratuity plan typically exposes the Company to actuarial risks such as: investment risk, interest risk, longevity
risk and salary risk.

Investment risk:

The present value of the defined benefit plan liability is calculated using a discount rate which is determined by
reference to market yields at the end of the reporting period on government bonds. For other defined benefit plans,
the discount rate is determined by reference to market yield at the end of reporting period on high quality corporate
bonds when there is a deep market for such bonds; if the return on plan asset is below this rate, it will create a
plan deficit.

Interest risk:

A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset by an increase
in the return on the plan debt investments.

Longevity risk:

The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality
of plan participants both during and after their employment. An increase in the life expectancy of the plan participants
will increase the plan''s liability.

Salary risk:

The present value of the defined plan liability is calculated by reference to the future salaries of plan participants.
As such, an increase in the salary of the plan participants will increase the plan''s liability.

The following table sets out the funded status of the Gratuity and the amount recognised in the Financial Statements:

The expense arises from equity settled ESARs amounting to I Nil (March 31, 2025 : Nil) for the year ended
March 31, 2026.

ESAR 2018 was renamed to Employee Stock Option Plan 2018 (ESOP 2018) and the ESARs outstanding as at
January 18, 2024 were converted to ESOPs, with no change in terms and conditions related to ex-ercise price and
vesting conditions. The above change was approved by the Nomination and Remuneration Committee at its meeting
held on January 18, 2024, Board at its meeting held on January 21, 2024 and is approved by the shareholders'' at
the extra-ordinary general meeting held on January 24, 2024.

b) Employee stock option plans (ESOPS)

(i) Employee Stock Option Plan 2020 (‘ESOP Plan 2020’)

ESOP Plan 2020 was approved by the shareholders of the company and subsequently the Grant was approved by
the Board and the Nomination and Remuneration Committee at its meeting held on May 5, 2020 with the grant date
of December 31, 2020 and meeting held on January 16, 2021 with the grant date of January 16, 2021. Details of
ESOP Plan 2020 granted are as follows:

47 The Company periodically files returns/statements with banks and financial institution as per the agreed terms and
they are in agreement with books of accounts of the Company. This information has been relied upon by the auditors.

48 Registration of charges or satisfaction with Registrar of Companies are filed and paid within the statutory period for
debt and borrowings issued during the year.

49 Money raised by way of debt instruments and the term loans have been applied by the Company for the purposes
for which they were raised, other than temporary deployment pending application of proceeds.

50 The borrowing facilities availed by the Company stipulate various covenants, which are monitored on a monthly or
quarterly basis. Non-compliance with the covenants attract penal provisions such as higher interest rates or a right
to recall the loan facility. The Company has met its borrowing obligations through the reporting periods and has a
track record of compliance with the loan covenants on an ongoing basis. There have been no breaches of covenants
during these period / years, and there is no likelihood of breaches in the foreseeable future given the adequate margin
of safety in respect of all financial covenants.

51 No proceedings have been initiated on or are pending against the Company for holding benami property under the
Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and Rules made thereunder.

52 The Company has not been declared wilful defaulter by any bank or financial institution or government or any
government authority.

53 The Company has no transactions with the companies struck off under Companies Act, 2013 or Companies Act, 1956.

54 The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign
entities (Intermediaries) with the understanding that the Intermediary shall:

a. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on
behalf of the Company (Ultimate Beneficiaries) or

b. provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries.

55 The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party)
with the understanding (whether recorded in writing or otherwise) that the Company shall:

a. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on
behalf of the Funding Party (Ultimate Beneficiaries) or

b. provide any guarantee, security or the like on behalf of the ultimate beneficiaries

56 There is no income surrendered or disclosed as income during the current or previous year in the tax assessments
under the Income Tax Act, 1961, that has not been recorded in the books of account.

57 Daily back up: Proper books of account as required by law have been kept by the Company. Back-up of the books of
account and papers maintained in electronic mode is maintained on servers physically located in India on a daily basis,
except in case of two applications (used for payroll processing and record maintenance) which are operated by third
party service providers, the management is not in possession of an appropriate Service Organization Controls report
to determine whether the back-up of books was maintained on servers physically located in India on a daily basis.

Audit trail: The Company uses accounting software TCS iON (General Ledger), TCS BaNCS LOS (Loan origination),
TCS BaNCS LMS (Loan management), Workline (HRMS) and HGS (Payroll) for maintaining its books of account which
have a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant
transactions recorded in the software, except that for:

a) TCS BaNCS LMS - the audit trail feature was enabled at database level from May 24, 2024

b) TCS iON (operated by third party service provider) - the management is not in the possession of the Service
Organization Controls report or other relevant evidence to determine whether the audit trail feature was enabled
and operated at database level through the year; and

c) Workline and HGS (operated by third party service providers) - the management is not in the possession of an
appropriate Service Organization Controls report to determine whether audit trail feature of the said software
was enabled and operated throughout the year for all relevant transactions recorded in the software.

Further, audit trail feature has not been tampered with in respect of accounting software where the audit trail has
been enabled. Additionally, the Company has preserved audit trail in respect of prior years and current year to the
extent it was enabled and recorded in respect of those years.

58 The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets
or both during the current or previous year.

59 On November 21, 2025, the Government of India notified the four Labour Codes - the Code on Wages, 2019,
the Industrial Relations Code, 2020, the Code on Social Security, 2020, and the Occupational Safety, Health and
Working Conditions Code, 2020 (''Labour Codes'') - consolidating 29 existing labour laws. The Labour Codes, amongst
other things introduce changes, including a uniform definition of wages. The Company has estimated the financial
implication of the change in definition of wages based on certain estimates and assumptions including expected
revisions to staff emoluments which has resulted an increase in the liability towards gratuity and compensated
absences arising out of past service cost by 11,592 lakhs (Net of tax 11,240 lakhs).

Considering the materiality and regulatory-driven, non-recurring nature of this impact, the Company has presented
such incremental impact under ''Exceptional Items'' in the standalone financial statements for the year ended
March 31, 2026 in line with guidance issued by ICAI.

The Company continues to monitor the finalisation of Central/ State Rules and clarifications from the Government on
other aspects of the Labour Codes and impact estimates will be re-assessed and finalised based on the final Rules,
industry practices, etc.

60 Disclosure of details required as per Master Direction - Reserve Bank of India (Non-Banking Financial Companies
- Financial Statements: Presentation and Disclosures) Directions, 2025 dated November 28, 2025 - RBI/DOR/2025-
26/359 DOR.ACC.REC.No.278/21.04.018/2025-26 and other applicable disclosure under RBI / NHB Directions:

60.2 There were no loans given against the collateral of gold and silver, hence disclosure related to gold and silver
collateral is not applicable.

60.3 In accordance with the Reserve Bank of India (Non-Banking Financial Companies - Resolution of Stressed Assets)
Directions. dated November 28, 2025, the Company has not lent any funds during the quarter and year ended
March 31, 2026 for project finance activities. Hence, no disclosure is required pertaining to projects financed
under the Reserve Bank of India (Non-Banking Financial Companies - Financial Statements Presentation and
Disclosures) Directions dated November 28, 2025.

60.4 The Company does not have Non-Fund Based (NFB) Credit Facilities, hence disclosure related to Non-Fund
Based (NFB) Credit Facilities is not applicable.

60.5 Details of transfer through Co-lending in respect of loans not in default during the year ended March 31, 2026

60.22 Details of financing parent company products

Nil during the year ended March 31, 2026 (March 31, 2025: Nil)

60.23 Details of Single Borrower Limit (SGL)/ Group Borrower Limit (GBL) exceeded by the HFC
Nil during the year ended March 31, 2026 (March 31, 2025: Nil)

60.24 Unsecured Advances

Nil during the year ended March 31, 2026 (March 31, 2025: Nil)

60.25 Disclosure of penalties imposed by RBI, NHB and other regulators

No penalty was paid during the year ended March 31, 2026 (15 lakhs in March 31, 2025)

60.26 There have been no instances of breach of covenants of loan availed or debt securities issued during the year
ended March 31, 2026 and March 31, 2025.

60.33 Revenue Recognition<

---

Mar 31, 2025

iii) The Company has raised '' 1,05,180 Lakh (March 31,2024: '' 1,32,000 Lakh) from Secured Redeemable Non Convertible Debentures (NCDs) during the year ended March 31, 2025. NCDs are long term and are secured by way of pari passu first charge by way of (present & future obligations) hypothecation on standard book debts/receivables/ outstanding moneys, current assets, Cash & Bank balances & Investments as per contracted terms except for those book debts/ receivables charged or to be charged in favour of NHB for refinance availed or to be availed from them and the Company has provided Security on specific immovable property on certain series of NCDs private placement (excluding IPO Series). NCDs including current maturities are redeemable at par in various periods.

iv) There has been no deviation in the utilisation of issue proceeds of publically issued secured redeemable NCD, from the Objects as stated in the Shelf prospectus document dated September 03, 2018.

v) Cash credit facilities from banks are secured by way of jointly ranking pari passu inter-se charge, along with NHB and NCD holders, on the Company''s book debts, housing loans and the whole of the present and future movable assets of the Company as applicable. All cash credit facilities are repayable as per the contracted/rollover term.

vi) External Commercial Borrowings from bank is availed from GIFT City which is considered outside India for reporting purposes. These loans are repayable as per the individual contracted terms in one or more instalments between March 2027 and March 2030. These loans are secured/to be secured by way of jointly ranking pari passu inter-se charge, along with NHB and NCD holders, on the Company''s book debts, housing loans and the whole of the present and future movable assets of the Company as applicable.

The National Housing Bank Directives requires all HFCs, accepting public deposits, to create a floating charge on the statutory liquid assets maintained in favour of the depositors through the mechanism of a Trust Deed. The Company has accordingly appointed SEBI approved Trustee Company as a Trustee for the above by executing a trust deed.

The public deposits of the Company as defined in paragraph 2(1)(y) of the Housing Finance Companies (NHB) Directions, 2010, are secured by floating charge on the Statutory Liquid Assets maintained in terms of sub-sections (1) and (2) of Section 29B of the National Housing Bank Act, 1987.

iii) Unsecured Redeemable Non-Convertible Debentures are subordinated to present and future senior indebtedness of the Company. These Unsecured Redeemable Non-Convertible Debentures qualifies as Tier II capital in accordance with National Housing Bank (NHB) guidelines for assessing capital adequacy based on balance term to maturity. These debentures are redeemable at par on maturity at the end of various periods.

Note: Includes allotment of 26,100 bonus shares pertaining to existing share holder holding shares in physical mode, allotment of same is pending on account of conversion of physical shares into demat mode.

b) Terms/Rights attached to equity shares

The Company has only one class of equity shares having a par value of '' 10 per share. Each holder of equity shares is entitled to one vote per share. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive the remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the share holders. Dividend declared towards equity shares will be subject to the approval of shareholder in the ensuing Annual General Meeting.

c) The Company has made an Initial Public Offer (IPO) for 9,52,55,598 equity shares aggregating to '' 300,000 Lakh of which 6,34,92,063 equity share aggregating to 2,00,000 Lakh were offered by selling shareholder and 3,17,63,535 equity shares aggregating to

'' 100,000 Lakh at the face value of '' 10 each at a premium of '' 305 per equity share (excluding discount of '' 23 per share on employee reservation portion of 2,39,726 equity shares) by way of fresh issue of the equity shares on May 13, 2024. The Company''s equity share got listed on National Stock Exchange of India Limited (NSE) and BSE Limited (BSE) on May 15, 2024.

d) The shareholders vide a special resolution have approved bonus issue of 35,52,79,473 equity shares of the Company in the ratio

of nine shares of face value of '' 10 each for each existing equity share of the face value of '' 10 each on January 16, 2021 in extraordinary general meeting (EGM).

e) The Company has not bought back any class of shares.

f) The Company has not allotted any class of shares as fully paid up pursuant to contract without payment being received in cash.

g) The Company has not proposed any dividend during the year ended March 31, 2025 and March 31, 2024.

24(a). Nature and Purpose of Reserves:

i. Capital reserve on Amalgamation - This reserve is created on account of merger of Aadhar Housing Finance Limited into DHFL Vysya Housing Finance Limited.

ii. Securities Premium - Securities premium account is used to record premium on issue of shares. The reserve is utilised in accordance with the provisions of Companies Act, 2013.

iii. Statutory Reserve - Section 29C (i) of the National Housing Act, 1987 defines that every housing finance institution which is a Company shall create a reserve fund and transfer therein a sum not less than twenty percent of its net profit every year as disclosed in the statement of profit and loss before any dividend is declared. For this purpose any special reserve created by the Company under Section 36(1)(viii) of the Income Tax Act 1961, is considered to be an eligible transfer. During the year ended March 31,2025, the Company has transferred an amount of '' 18,243 Lakh [P.Y. '' 14,970 Lakh] to special reserve in terms of Section 36(1)(viii) of the Income Tax Act 1961 and has been considered eligible for special reserve u/s 29C of the National Housing Bank Act, 1987.

iv. Debenture Redemption reserve - This reserve is created while issuing Debentures with an objective to reduce the risk of default in repayments of debentures. The Company has created debenture redemption reserve towards its public issue of Secured Redeemable Non-convertible Debentures.

v. Employee Stock Option Outstanding - This reserve relates to stock option granted by the Company to employees under various ESOP schemes.

vi. Items of other comprehensive income:-

a) Remeasurement of defined benefit liability/ asset - This represents the acturial gain/(loss) on employee benefit plans.

b) Effective portion of cash flow hedge reserve - It represents the cumulative gains/(losses) arising on revaluation of the derivative instruments designated as cash flow hedges through OCI.

The Company is also involved in other law suits, claims, investigations and proceedings, including collection and repossession related matters, which arise in the ordinary course of business. However, there are no significant claims on such cases. Future cash outflows in respect of the above, if any, is determinable only on receipt of judgement/decisions pending with the relevant authorities.

33. Contingent liabilities
Claims against the Company not acknowledged as debt:		('' in Lakhs)
Particulars	As at March 31,2025	As at March 31,2024
Income tax matters of earlier years	296	300
Indirect tax matters of earlier years	574	1,267
Total	870	1,567

Part of the aforementioned contingent liabilities towards income tax and indirect tax have been paid under protest.

34. Commitments

i. Estimated amount of contracts remaining to be executed on capital account including intangible asset (net of advances) and not provided for as at March 31,2025''735 Lakh (March 31, 2024''394 Lakh).

ii. Undisbursed amount of loans sanctioned and partly disbursed as at March 31,2025 is '' 1,90,015 Lakh (March 31,2024''94,882 Lakh).

iii. Undisbursed amount of loans sanctioned but not disbursed as at March 31,2025 is '' 1,45,442 Lakh (March 31,2024''1,06,702 Lakh).

36. Financial instruments (i) Fair value hierarchy

The Company uses the following hierarchy to determine the fair values of its financial instruments that are (a) recognised and measured at fair value and (b) measured at amortised cost and for which fair values are disclosed in the financial statements:

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments and mutual funds that have quoted price. The fair value of all equity instruments which are traded in the stock exchanges is valued using the closing price as at the reporting period. The mutual funds are valued using the closing NAV.

Level 2: The fair value of financial instruments that are not traded in an active market (for example, traded bonds, over-the-counter derivatives) is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is the case for unlisted equity securities, contingent consideration and indemnification asset included in level 3.

There were no transfers between levels 1, 2 and 3 during the year.

The Company recognises transfers in and transfers out of fair value hierarchy levels as at the end of the reporting period.

(ii) Valuation process

The management of the Company performs the valuations of financial assets and liabilities required for financial reporting purposes.

The carrying amounts of trade receivables, trade payables, capital creditors and cash and cash equivalents are considered to be the same as their fair values, due to their short-term nature.

The fair values for loans are calculated based on cash flows discounted using a current lending rate. They are classified as level 3 fair values in the fair value hierarchy due to the inclusion of unobservable inputs including counterparty credit risk.

The fair values of borrowings are based on discounted cash flows using a current borrowing rate. They are classified as level 3 fair values in the fair value hierarchy due to the use of unobservable inputs, including own credit risk.

For financial assets and liabilities that are measured at fair value, the carrying amounts are equal to the fair values.

38. Financial risk managementa. Liquidity Risk

Liquidity risk is the current and prospective risk arising out of an inability to meet financial commitments as they fall due, through available cash flows or through the sale of assets at fair market value. It includes both, the risk of unexpected increases in the cost of funding an asset portfolio at appropriate maturities and the risk of being unable to liquidate a position in a timely manner at a reasonable price.

The Company manages liquidity risk by maintaining sufficient cash and marketable securities and by having access to funding through an adequate amount of committed credit lines. Given the need to fund diverse products, the Company maintains flexibility in funding by maintaining availability under committed credit lines to meet obligations when due. Management regularly monitors the position of cash and cash equivalents vis-a-vis projections. Assessment of maturity profiles of financial assets and financial liabilities including debt financing plans and maintenance of Balance Sheet liquidity ratios are considered while reviewing the liquidity position.

Liquidity risk is managed in accordance with our Asset Liability Management Policy. This policy is framed as per the current regulatory guidelines and is approved by the Board of Directors. The Asset Liability Management Policy is reviewed periodically to incorporate changes as required by regulatory stipulation or to realign the policy with changes in the economic landscape. The Asset Liability Committee (ALCO) of the Company formulates and reviews strategies and provides guidance for management of liquidity risk within the framework laid out in the Asset Liability Management Policy.

b. Interest Risk

The core business of the Company is providing housing and other mortgage loans. The Company borrows through various financial instruments to finance its core lending activity. These activities expose the Company to interest rate risk.

I nterest rate risk is measured through earnings at risk from an earnings perspective and through duration of equity from an economic value perspective. Further, exposure to fluctuations in interest rates is also measured by way of gap analysis, providing a static view of the maturity and re-pricing characteristic of Balance sheet positions. An interest rate sensitivity gap report is prepared by classifying all rate sensitive assets and rate sensitive liabilities into various time period categories according to contracted/behavioural maturities or anticipated re-pricing date. The difference in the amount of rate sensitive assets and rate sensitive liabilities maturing or being re-priced in any time period category, gives an indication of the extent of exposure to the risk of potential changes in the margins on new or re-priced assets and liabilities. The interest rate risk is monitored through above measures on a quarterly basis.

The Company has USD denominated liability (External commercial borrowings) at floating rate of interest causing volatility in the cash flow arising on principal and interest repayment. Management aims to hedge the volatility with appropriate derivative instruments. Accordingly, the Company entered into foreign currency forwards and cross currency interest rate swaps with tenor and maturity matching with the underlying cashflow.

Interest Rate Sensitivity

The following table demonstrates the net sensitivity to a reasonably possible change in interest rate (all other variables being constant) of the Company''s statement of profit and loss (before taxes) and equity

c. Price risk

The Company''s exposure to price risk is not material and it is primarily on account of investment of temporary treasury surplus in the highly liquid debt funds for very short durations. The Company has a board approved policy of investing its surplus funds in highly rated debt mutual funds and other instruments having insignificant price risk, not being equity funds/ risk bearing instruments.

d. Market risk

Market risk arises from fluctuation in the fair value of future cash flow of financial instruments due to changes in the market variables such as interest rates, foreign exchange rates and equity prices. Market risk for the Company encompasses exposures to equity investments, changes in exchange rates, interest rate risks on investment portfolios as well as the floating rate assets and liabilities with differing maturity profiles. Generally the borrowing are denominated in currencies that match the cash flows generated by the underlying operations of the Company - primarily (''). In case where borrowings are denominated in foreign currency, the Company uses derivative to manage the risk. All such transactions are carried out within guidelines set out Asset & liability committee (ALCO). The Company has applied hedge accounting to manage volatility in profit and loss.

e. Currency risk

The Company is exposed to foreign currency fluctuation risk for its external commercial borrowing (ECB). The Company has hedged the entire ECB exposure for the full tenure as per Board approved Foreign Exchange Risk Management policy. The Company has entered into foreign currency forwards and cross currency interest rate swaps with strategy which aims to hedge a defined portion of the exposure to USD - INR exchange rate volatility on borrowings and interest repayable in USD. The Company evaluates the foreign currency exchange rates, tenure of ECB and its fully hedged costs for raising ECB. The Company manages its currency risks by entering into over the counter (OTC) derivatives contracts as hedge positions and the same are being governed through the Board approved Foreign Exchange Risk Management Policy.

Hedging policy

The Company''s hedging policy only allows for the effective hedging relationships to be considered as hedges as per the relevant Ind AS. Hedge effectiveness is determined at the inception of the hedge relationship and through the periodic prospective effectiveness assessments to ensure that the economic relationship exists between the hedged item and hedging instrument. The Company enters into hedge relationships where the critical terms of the hedging instrument match with the terms of hedged item and so a qualitative and quantitative assessment of effectiveness is performed.

Hedge Ratio:

There is an economic relationship between the hedged item and the hedging instrument as the terms of the foreign currency forward contracts and cross currency interest rate swaps contracts match that of the foreign currency borrowings. The Company has established a hedge ratio of 1:1 for the hedging relationships as the underlying risk of the foreign currency forward and cross currency interest rate swaps are identical to the hedged risk components. The Company has entered into 100% cash flow contracts towards principal and interest denominated in USD into fixed amount of INR Accordingly, hedge relationship is effective. The hedge ineffectiveness can arise mainly if there is a change in the credit risk of the Company or the counterparty.

f. Credit risk

Credit risk is the risk of loss that may occur from the failure of any party to abide by the terms and conditions of any contract, principally the failure to make required payments of amounts due to the Company. In its lending operations, the Company is principally exposed to credit risk.

The credit risk is governed by the Credit Policy approved by the Board of Directors. The Credit Policy outlines the type of products that can be offered, customer categories, the targeted customer profile and the credit approval process and limits.

The Company measures, monitors and manages credit risk at an individual borrower level and at the group exposure level for corporate borrowers. The credit risk for retail borrowers is being managed at portfolio level for both Home loans and other property loans. The Company has a structured and standardised credit approval process, which includes a well-established procedure of comprehensive credit appraisal. The Risk Management Policy addresses the recognition, measurement, monitoring and reporting of the Credit risk.

Credit Risk Assessment Methodology

Company''s customers for retail loans are primarily lower and middle income, salaried and self-employed individuals. The loans are secured by the mortgage of the borrowers'' property.

The Company''s credit officers evaluate credit proposals on the basis of operating policies approved by the Board of Directors. The criteria typically include factors such as the borrower''s income, the loan-to-value ratio and demographic parameters. Any deviations need to be approved at the designated levels.

External agencies such as field investigation agencies facilitate a comprehensive due diligence process including visits to offices and homes in the case of loans made to retail borrowers.

Company monitor''s borrower account behaviour as well as static data regularly to monitor the portfolio performance of each product segment regularly, and use these as inputs in revising its product programs, target market definitions and credit assessment criteria to meet the twin objectives of combining volume growth and maintenance of asset quality.

The key elements in calculation of ECL are as follows:

PD - The Probability of Default is an estimate of the likelihood of default over a given time horizon. A default may only happen at a certain time over the assessed period, if the facility has not been previously derecognised and is still in the portfolio. The PD has been determined based on seasoned historical portfolio data using the survival analysis methodology.

EAD - The Exposure at Default includes repayments scheduled by contract or otherwise, expected drawdowns on committed facilities, accrued interest from missed payments and loan commitments.

LGD - The Loss Given Default is an estimate of the loss arising in the case where a default occurs at a given time. It is based on the difference between the contractual cash flows due and those that the lender would expect to receive, including from the realisation of any collateral. It is usually expressed as a percentage of the EAD. The LGD is determined based on seasoned historical portfolio data.

The customers who have availed the benefit of one-time restructuring have been disclosed in stage 2 assets.

An analysis of changes in the gross carrying amount (excluding adjustment to carrying value on account of application of effective interest rate) and the corresponding ECL allowances in relation to lending is, as follows:

a) Housing and Other Loans

The table below shows the credit quality and the exposure to credit risk based on the year-end stage classification. The amounts presented are gross of impairment allowances.

39. Capital Management

The Company''s objectives when managing capital are to

• safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders, and

• Maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. The Company monitors capital on the basis of the following gearing ratio: Net debt (total borrowings net of cash and cash equivalents and Liquid investments) divided by Total ''equity'' (as shown in the balance sheet) and Capital adequacy ratio.

40. Segment reporting

The Company operates only in one Operating Segment i.e Housing Finance business - Financial Services and all other activities are incidental to the main business activity, hence have only one reportable Segment as per Indian Accounting Standard 108 “Operating Segments” The reportable business segments are in line with the segment wise information which is being presented to the CODM. The Company has identified Managing Director and CEO as CODM.

The Company has its operations within India and all revenue is generated within India.

41. Employee benefits41.1 Defined contribution plan

The Company makes contributions to provident fund for qualifying employees to Regional Provident Fund Commissioner under defined contribution plan under the Provident Fund Act.

41.2Defined obligation benefit

The Company provides gratuity to its employees which are defined benefit plan. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

The gratuity plan typically exposes the Company to actuarial risks such as: investment risk, interest risk, longevity risk and salary risk.

Investment risk:

The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end of the reporting period on government bonds. For other defined benefit plans, the discount rate is determined by reference to market yield at the end of reporting period on high quality corporate bonds when there is a deep market for such bonds; if the return on plan asset is below this rate, it will create a plan deficit.

Interest risk:

A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset by an increase in the return on the plan debt investments.

Longevity risk:

The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan''s liability.

Salary risk:

The present value of the defined plan liability is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the plan''s liability.

The expense arises from equity settled ESARs amounting to '' Nil (March 31, 2024: Nil ) for the year ended March 31, 2025.

ESAR 2018 was renamed to Employee Stock Option Plan 2018 (ESOP 2018) and the ESARs outstanding as at January 18, 2024 were converted to ESOPs, with no change in terms and conditions related to exercise price and vesting conditions. The above change was approved by the Nomination and Remuneration Committee at its meeting held on January 18, 2024, Board at its meeting held on January 21, 2024 and is approved by the shareholders'' at the extra-ordinary general meeting held on January 24, 2024.

b) Employee stock option plans (ESOPS)

Employee Stock Option Plan 2020 (“ESOP Plan 2020")

ESOP Plan 2020 was approved by the shareholders of the Company and subsequently the Grant was approved by the Board and the Nomination and Remuneration Committee at its meeting held on May 05, 2020 with the grant date of December 31,2020 and meeting held on January 16,, 2021 with the grant date of January 16, 2021. Details of ESOP Plan 2020 granted are as follows:

49. The Company periodically files returns/statements with banks and financial institution as per the agreed terms and they are in agreement with books of accounts of the Company. This information has been relied upon by the auditors.

50. Registration of charges or satisfaction with Registrar of Companies are filed and paid within the statutory period for debt and borrowings issued during the year.

51. Money raised by way of debt instruments and the term loans have been applied by the Company for the purposes for which they were raised, other than temporary deployment pending application of proceeds.

52. No proceedings have been initiated on or are pending against the Company for holding benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and Rules made thereunder.

53. The Company has not been declared wilful defaulter by any bank or financial institution or government or any government authority.

54. The Company has no transactions with the companies struck off under Companies Act, 2013 or Companies Act, 1956.

55. The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

a. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (Ultimate Beneficiaries) or

b. provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries.

56. The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

a. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

b. provide any guarantee, security or the like on behalf of the ultimate beneficiaries

57. There is no income surrendered or disclosed as income during the current or previous year in the tax assessments under the Income Tax Act, 1961, that has not been recorded in the books of account.

58. Daily back up: Proper books of account as required by law have been kept by the Company. Back-up of the books of account and papers maintained in electronic mode is maintained on servers physically located in India on a daily basis, except in case of two applications (used for payroll processing and record maintenance) which are operated by third party service providers, the management is not in possession of an appropriate Service Organisation Controls report to determine whether the back-up of books was maintained on servers physically located in India on a daily basis.

Audit trail: The Company uses accounting software TCS iON (General Ledger), TCS BaNCS LOS (Loan origination), TCS BaNCS LMS (Loan management), Workline (HRMS) and HGS (Payroll) for maintaining its books of account which have a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software, except that for:

a) TCS BaNCS LMS - the audit trail feature was enabled at database level from May 24, 2024;

b) TCS iON (operated by third party service provider) - the management is not in the possession of the Service Organisation Controls report or other relevant evidence to determine whether the audit trail feature was enabled and operated at database level through the year; and

c) Workline and HGS (operated by third party service providers) - the management is not in the possession of an appropriate Service Organisation Controls report to determine whether audit trail feature of the said software was enabled and operated throughout the year for all relevant transactions recorded in the software.

Further, audit trail feature has not been tampered with in respect of accounting software where the audit trail has been enabled. Additionally, the Company has preserved audit trail in respect of the financial years ended March 31, 2024 and March 31, 2025 to the extent it was enabled and recorded in respect of those years.

59. The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets or both during the current or previous year.

60. There have been no instances of breach of covenants of loan availed or debt securities issued during the year ended March 31,2025 and March 31,2024.

61. Divergence in the asset classification and provisioning

There is no divergence in asset classification and provisioning as assessed by NHB where:

i) The additional provisioning requirements assessed by National Housing Bank (NHB) exceeds 5% of the reported profits before tax and impairment loss on financial instruments as on March 31,2025, or

ii) The additional Gross NPAs identified by NHB exceeds 5% of the reported Gross NPAs as on March 31, 2025.

62. Disclosure of details required as per Master Direction - Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021 dated February 17, 2021 - RBI/2020-21/73 DOR.FIN.HFC.CC.No.120/03.10.136/2020-21 and Master Direction - Reserve Bank of India (Non-Banking Financial Company - Scale Based Regulation) Directions, 2023 dated October 19, 2023 - RBI/DoR/2023-24/106 DoR.FIN.REC.No.45/03.10.119/2023-24:

Note: Above does not include the provision for commission amounting to '' 160 Lakh (excluding disallowance of GST) for the year ended March 31,2025 which will be paid subject to approval in the ensuing Annual General Meeting. Commission paid during the year (FY 24-25) pertains to previous year (FY 23-24).

62.23 Net profit or Loss for the year, prior period items and changes in accounting policies

The financial statements have been prepared under historical cost convention on an accrual basis in accordance with the Indian Accounting Standards ("Ind AS'''') and the relevant provisions of the Companies Act, 2013 (the "Act") (to the extent notified). Same accounting policies have been followed for all period presented in these financial statements.

62.24 Revenue Recognition

There have been no instances in which revenue recognition has been postponed pending the resolution of significant uncertainties.

62.25 Consolidated Financial Statements (CFS)

Refer to the Consolidated Financial Statements for the relevant disclosures.

62.27 Insurance portion of Housing Loan is excluded from Housing Loan and regrouped in Other Property Loans (Refer Note 62.9, 62.26, 62.32, 62.38). The Insurance portion amounting to '' 68,258 Lakh (March 31, 2024: '' 59,094 Lakh) helps in mitigating the risk and secures the Company''s Loan portfolio against any eventuality.

62.28 The Company has prepared the financial statements taking into consideration the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended (“Ind AS''''), and other accounting principles generally accepted in India including the prevailing RBI/NHB regulations.

The Company has complied with the extant provisions of the applicable Ind AS for the purpose of asset classification based on credit risks and provisioning as per expected credit loss requirements during the financial year ended March 31, 2025. In respect of asset classification and provisioning requirements, the Company has complied with RBI Circulars dated March 13, 2020 on implementation of Indian Accounting Standards and have considered the impact of the RBI circulars during the year.

Refer for Note 45 - (comparison between provisions required under Income Recognition, Asset classification and provision norms and impairment allowances made under Ind AS 109)

---

Mar 31, 2024

i) All Housing and other loans are originated in India.

ii) Loans granted by the Company are secured by equitable mortgage/ registered mortgage of the property and assets financed and/ or undertaking to create a security and/or assignment of Life Insurance Policies and/or personal guarantees and/or hypothecation of assets and are considered appropriate and good.

iii) The Company has assigned pool of certain housing and property loans and managed servicing of such loan accounts. The balance outstanding in the pool, as at the reporting date aggregates '' 4,14,046 Lakh (March 31,2023: '' 3,28,179 Lakh). The carrying value of these assets have been de-recognised in the books of the Company.

iv) There is no outstanding loan to Public institution.

v) There were no loans given against the collateral of gold jewellery and hence the percentage of such loans to the total outstanding asset is Nil (March 31,2023 : Nil).

vi) Housing loan and other property loan includes '' 18,888 Lakh (March 31,2023: '' 12,526 Lakh) given to employees of the Company under the staff loan.

vii) Housing loan and other property loan includes '' 5,806 Lakh (March 31, 2023: '' 3,976 Lakh) in respect of properties held for disposal under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.

viii) The Company have created an additonal impairment provision of '' 6,993 Lakh as at March 31,2024 (March 31,2023 : '' 7,631 Lakh) on account of management overlay and One time restructuring.

a) Based on and to the extent of information received by the Company from the suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act) and relied upon by the auditors.

There are no overdue amounts to Micro, Small and Medium Enterprises as at March 31, 2024 for which disclosure requirements under Micro, Small and Medium Enterprises Development Act, 2006 are applicable.

iii) The Company has raised '' 1,32,000 Lakh (March 31,2023 : '' 91,700 Lakh) from Secured Redeemable Non Convertible Debentures (NCDs) during the year ended March 31, 2024. NCDs are long term and are secured by way of pari passu first charge by way of (present & future obligations) hypothecation on standard book debts / receivables/ outstanding moneys, current assets, Cash & Bank balances & Investments as per contracted terms except for those book debts/ receivables charged or to be charged in favour of NHB for refinance availed or to be availed from them and the Company has provided Security on specific immovable property on certain series of NCDs private placement (excluding IPO Series). NCDs including current maturities are redeemable at par in various periods.

iv) There has been no deviation in the utilisation of issue proceeds of publically issued secured redeemable NCD, from the Objects as stated in the Shelf prospectus document dated September 03, 2018.

iii) The secured term loans from banks are availed from various scheduled banks. These loans are repayable as per the individual contracted terms in one or more instalments between April 2024 and November 2038. These loans are secured / to be secured by way of jointly ranking pari passu inter-se charge, along with NHB and NCD holders, on the Company''s book debts, housing loans and the whole of the present and future movable assets of the Company as applicable.

iv) Secured term loan from National Housing Bank are repayable as per the contracted terms in one or more instalments between April 2024 and January 2034. These loans from National Housing Bank are secured / to be secured by way of first charge to and in favour of NHB, other banks and NCD holders and jointly ranking pari passu inter-se, on the Company''s book debts, housing loans and the whole of the present and future movable and immovable assets wherever situated excluding SLR assets.

v) Cash credit facilities from banks are secured by way of jointly ranking pari passu inter-se charge, along with NHB and NCD holders, on the Company''s book debts, housing loans and the whole of the present and future movable assets of the Company as applicable. All cash credit facilities are repayable as per the contracted / rollover term.

The National Housing Bank Directives requires all HFCs, accepting public deposits, to create a floating charge on the statutory liquid assets maintained in favour ofthe depositors through the mechanismofaTrust Deed. The Company has accordingly appointed SEBI approved Trustee Company as a Trustee for the above by executing a trust deed.

The public deposits of the Company as defined in paragraph 2(1)(y) of the Housing Finance Companies (NHB) Directions, 2010, are secured by floating charge on the Statutory Liquid Assets maintained in terms of sub-sections (1) and (2) of Section 29B of the National Housing Bank Act, 1987.

iii) Unsecured Redeemable Non-Convertible Debentures are subordinated to present and future senior indebtedness of the Company. These Unsecured Redeemable Non-Convertible Debentures qualifies as Tier II capital in accordance with National Housing Bank (NHB) guidelines for assessing capital adequacy based on balance term to maturity. These debentures are redeemable at par on maturity at the end of various periods.

b) Terms / Rights attached to equity shares

The Company has only one class of equity shares having a par value of '' 10 per share. Each holder of equity shares is entitled to one vote per share. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive the remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the share holders. Dividend declared towards equity shares will be subject to the approval of shareholder in the ensuing Annual General Meeting.

c) The Company has made an Initial Public Offer (IPO) for 9,52,55,598 equity shares aggregating to '' 3,00,000 Lakh of which 6,34,92,063 equity share aggregating to 2,00,000 Lakh were offered by selling shareholder and 3,17,63,535 equity shares aggregating to '' 100,000 Lakh at the face value of '' 10 each at a premium of '' 305 per equity share (excluding discount of '' 23 per share on employee reservation portion of 2,39,726 equity shares) by way of fresh issue of the equity shares on May 13, 2024. The Company''s equity share got listed on National Stock Exchange of India Limited (NSE) and BSE Limited (BSE) on May 15, 2024.

d) The shareholders vide a special resolution have approved bonus issue of 35,52,79,473 equity shares of the Company in the ratio of nine shares of face value of '' 10 each for each existing equity share of the face value of '' 10 each on January 16, 2021 in extraordinary general meeting (EGM).

e) The Company has not bought back any class of shares.

f) The Company has not allotted any class of shares as fully paid up pursuant to contract without payment being received in cash.

g) The Company has not proposed any dividend during the year ended March 31,2024.

23(a). Nature and Purpose of Reserves:

i. Capital reserve on Amalgamation - This reserve is created on account of merger of Aadhar Housing Finance Limited into DHFL Vysya Housing Finance Limited.

ii. Securities Premium - Securities premium account is used to record premium on issue of shares. The reserve is utilised in accordance with the provisions of Companies Act, 2013.

iii. Statutory Reserve - Section 29C (i) of the National Housing Act, 1987 defines that every housing finance institution which is a Company shall create a reserve fund and transfer therein a sum not less than twenty percent of its net profit every year as disclosed in the statement of profit and loss before any dividend is declared. For this purpose any special reserve created by the Company under Section 36(1)(viii) of the Income Tax Act 1961, is considered to be an eligible transfer. During the year ended March 31, 2024, the Company has transferred an amount of '' 14,970 Lakh [P.Y. '' 10,900 Lakh] to special reserve in terms of Section 36(1)(viii) of the Income Tax Act 1961 and has been considered eligible for special reserve u/s 29C of the National Housing Bank Act, 1987.

iv. Debenture Redemption reserve - This reserve is created while issuing Debentures with an objective to reduce the risk of default in repayments of debentures. The Company has created debenture redemption reserve towards its public issue of Secured Redeemable Non-convertible Debentures.

v. Employee Stock Option Outstanding - This reserve relates to stock option granted by the Company to employees under various ESOP schemes.

27.1 The Company has reversed impairment provision of '' 638 Lakh during the year ended March 31,2024 towards management overlay and loans on which one-time restructuring was implemented (March 31,2023 impairment reverse of '' 905 Lakh).

27.2 Impairment allowance on Loans (including write off) includes reversal of '' 627 Lakh during the year ended March 31,2024 (March 31, 2023 : includes reversal of '' 754 Lakh) towards loans to developers. The net carrying value of loans to developers after impairment provision is Nil as at March 31, 2024 (Nil as at March 31, 2023). The Company has not made any fresh loan sanctions under loans to developers during the year ended March 31,2024 (for the year ended March 31,2023 : Nil).

32. Contingent liabilities Claims against the Company not acknowledged as debt:		('' in Lakh)
Particulars	As at March 31, 2024	As at March 31,2023
Income tax matters of earlier years	300	378
Indirect tax matters of earlier years	1,267	521
Total	1,567	899

The Company is also involved in other law suits, claims, investigations and proceedings, including collection and repossession related matters, which arise in the ordinary course of business. However, there are no significant claims on such cases. Future cash outflows in respect of the above, if any, is determinable only on receipt of judgement / decisions pending with the relevant authorities.

Part of the aforementioned contingent liabilities towards income tax and indirect tax have been paid under protest.

33. Commitments

i. Estimated amount of contracts remaining to be executed on capital account (net of advances) and not provided for as at March 31, 2024''394 Lakh (March 31,2023''482 Lakh).

ii. Undisbursed amount of loans sanctioned and partly disbursed as at March 31, 2024 is '' 94,882 Lakh (March 31, 2023 '' 90,071 Lakh).

iii. Undisbursed amount of loans sanctioned but not disbursed as at March 31, 2024 is '' 1,06,702 Lakh (March 31, 2023 '' 78,478 Lakh).

35. Financial instruments

(i) Fair value hierarchy

The Company uses the following hierarchy to determine the fair values of its financial instruments that are (a) recognised and measured at fair value and (b) measured at amortised cost and for which fair values are disclosed in the financial statements:

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments and mutual funds that have quoted price. The fair value of all equity instruments which are traded in the stock exchanges is valued using the closing price as at the reporting period. The mutual funds are valued using the closing NAV.

Level 2: The fair value of financial instruments that are not traded in an active market (for example, traded bonds, over-the-counter derivatives) is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is the case for unlisted equity securities, contingent consideration and indemnification asset included in level 3.

There were no transfers between levels 1,2 and 3 during the year.

The Company recognises transfers in and transfers out of fair value hierarchy levels as at the end of the reporting period.

(ii) Valuation process

The management of the Company performs the valuations of financial assets and liabilities required for financial reporting purposes.

The carrying amounts of trade receivables, trade payables, capital creditors and cash and cash equivalents are considered to be the same as their fair values, due to their short-term nature.

The fair values for loans are calculated based on cash flows discounted using a current lending rate. They are classified as level 3 fair values in the fair value hierarchy due to the inclusion of unobservable inputs including counterparty credit risk.

The fair values of borrowings are based on discounted cash flows using a current borrowing rate. They are classified as level 3 fair values in the fair value hierarchy due to the use of unobservable inputs, including own credit risk.

For financial assets and liabilities that are measured at fair value, the carrying amounts are equal to the fair values.

Note: The maturity analysis is prepared considering the prepayments on housing and other loans in line with historical trend. Classification of assets and liabilities under the different maturity buckets is based on the same estimates and assumptions as used by the Company for compiling the return submitted to the RBI/NHB, which has been relied upon by the auditors.

37. Financial risk management

a. Liquidity Risk

Liquidity risk is the current and prospective risk arising out of an inability to meet financial commitments as they fall due, through available cash flows or through the sale of assets at fair market value. It includes both, the risk of unexpected increases in the cost of funding an asset portfolio at appropriate maturities and the risk of being unable to liquidate a position in a timely manner at a reasonable price.

The Company manages liquidity risk by maintaining sufficient cash and marketable securities and by having access to funding through an adequate amount of committed credit lines. Given the need to fund diverse products, the Company maintains flexibility in funding by maintaining availability under committed credit lines to meet obligations when due. Management regularly monitors the position of cash and cash equivalents vis-a-vis projections. Assessment of maturity profiles of financial assets and financial liabilities including debt financing plans and maintenance of Balance Sheet liquidity ratios are considered while reviewing the liquidity position.

Liquidity risk is managed in accordance with our Asset Liability Management Policy. This policy is framed as per the current regulatory guidelines and is approved by the Board of Directors. The Asset Liability Management Policy is reviewed periodically to incorporate changes as required by regulatory stipulation or to realign the policy with changes in the economic landscape. The Asset Liability Committee (ALCO) of the Company formulates and reviews strategies and provides guidance for management of liquidity risk within the framework laid out in the Asset Liability Management Policy.

Note: The maturity analysis is prepared considering the prepayments on housing and other loans in line with historical trend. Classification of assets and liabilities under the different maturity buckets is based on the same estimates and assumptions as used by the company for compiling the return submitted to the NHB, which has been relied upon by the auditors.

b. Interest Risk

The core business of the company is providing housing and other mortgage loans. The company borrows through various financial instruments to finance its core lending activity. These activities expose the company to interest rate risk.

I nterest rate risk is measured through earnings at risk from an earnings perspective and through duration of equity from an economic value perspective. Further, exposure to fluctuations in interest rates is also measured by way of gap analysis, providing a static view of the maturity and re-pricing characteristic of Balance sheet positions. An interest rate sensitivity gap report is prepared by classifying all rate sensitive assets and rate sensitive liabilities into various time period categories according to contracted/behavioural maturities or anticipated re-pricing date. The difference in the amount of rate sensitive assets and rate sensitive liabilities maturing or being re-priced in any time period category, gives an indication of the extent of exposure to the risk of potential changes in the margins on new or re-priced assets and liabilities. The interest rate risk is monitored through above measures on a quarterly basis.

Interest Rate Sensitivity

The following table demonstrates the net sensitivity to a reasonably possible change in interest rate (all other variables being constant) of the Company''s statement of profit and loss (before taxes) and equity

c. Price risk

The Company''s exposure to price risk is not material and it is primarily on account of investment of temporary treasury surplus in the highly liquid debt funds for very short durations. The Company has a board approved policy of investing its surplus funds in highly rated debt mutual funds and other instruments having insignificant price risk, not being equity funds/ risk bearing instruments.

d. Credit risk

Credit risk is the risk of loss that may occur from the failure of any party to abide by the terms and conditions of any contract, principally the failure to make required payments of amounts due to the company. In its lending operations, the Company is principally exposed to credit risk.

The credit risk is governed by the Credit Policy approved by the Board of Directors. The Credit Policy outlines the type of products that can be offered, customer categories, the targeted customer profile and the credit approval process and limits.

The Company measures, monitors and manages credit risk at an individual borrower level and at the group exposure level for corporate borrowers. The credit risk for retail borrowers is being managed at portfolio level for both Home loans and other property loans. The Company has a structured and standardized credit approval process, which includes a well-established procedure of comprehensive credit appraisal. The Risk Management Policy addresses the recognition, measurement, monitoring and reporting of the Credit risk.

Credit Risk Assessment Methodology

Company''s customers for retail loans are primarily lower and middle income, salaried and self-employed individuals. The loans are secured by the mortgage of the borrowers'' property.

The Company''s credit officers evaluate credit proposals on the basis of operating policies approved by the Board of Directors. The criteria typically include factors such as the borrower''s income, the loan-to-value ratio and demographic parameters. Any deviations need to be approved at the designated levels.

External agencies such as field investigation agencies facilitate a comprehensive due diligence process including visits to offices and homes in the case of loans made to retail borrowers.

Company monitor''s borrower account behaviour as well as static data regularly to monitor the portfolio performance of each product segment regularly, and use these as inputs in revising its product programs, target market definitions and credit assessment criteria to meet the twin objectives of combining volume growth and maintenance of asset quality.

The Company''s current credit risk grading framework comprises the following categories:

Category	Description	Basis for recognising expected credit losses (ECL)
Stage 1	High quality assets	12-month ECL
Stage 2	Assets for which there is significant increase in credit risk	Lifetime ECL
Stage 3	Credit-impaired assets	Lifetime ECL - credit-impaired

The key elements in calculation of ECL are as follows:

PD - The Probability of Default is an estimate of the likelihood of default over a given time horizon. A default may only happen at a certain time over the assessed period, if the facility has not been previously derecognised and is still in the portfolio. The PD has been determined based on seasoned historical portfolio data using the survival analysis methodology.

EAD - The Exposure at Default includes repayments scheduled by contract or otherwise, expected drawdowns on committed facilities, accrued interest from missed payments and loan commitments.

LGD - The Loss Given Default is an estimate of the loss arising in the case where a default occurs at a given time. It is based on the difference between the contractual cash flows due and those that the lender would expect to receive, including from the realisation of any collateral. It is usually expressed as a percentage of the EAD. The LGD is determined based on seasoned historical portfolio data.

Based on management overlay and one-time restructuring provision amount of '' 6,993 Lakh has been carried as of March 31,2024 (March 31,2023: '' 7,631 Lakh).

The customers who have availed the benefit of one-time restructuring have been disclosed in stage 2 assets.

An analysis of changes in the gross carrying amount (excluding adjustment to carrying value on account of application of effective interest rate) and the corresponding ECL allowances in relation to lending is, as follows:

a) Housing and Other Property Loan

The table below shows the credit quality and the exposure to credit risk based on the year-end stage classification. The amounts presented are gross of impairment allowances.

38. Capital Management

The Company''s objectives when managing capital are to

• safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders, and

• Maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. The Company monitors capital on the basis of the following gearing ratio: Net debt (total borrowings net of cash and cash equivalents and Liquid investments) divided by Total ''equity'' (as shown in the balance sheet) and Capital adequacy ratio.

Liquidity Coverage Ratio requirement applicable from December 1, 2021 to the Company as per Master Direction - Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021 circular no RBI/2020-21/73 DOR.FIN.HFC. CC.No.120/03.10.136/2020-21 dated February 17, 2021.

39. Segment reporting

The Company operates only in one Operating Segment i.e Housing Finance business - Financial Services and all other activities are incidental to the main business activity, hence have only one reportable Segment as per Indian Accounting Standard 108 "Operating Segments". The reportable business segments are in line with the segment wise information which is being presented to the CODM. The Company has identified Managing Director and CEO as CODM.

The Company has its operations within India and all revenue is generated within India.

40. Employee benefits

40.1 Defined contribution plan

The Company makes contributions to provident fund for qualifying employees to Regional Provident Fund Commissioner under defined contribution plan under the Provident Fund Act.

Amount recognised as an expense and included under the head "Contribution to Provident and Other Funds" of Statement of Profit and Loss are as follows:

40.2 Defined obligation benefit

The Company provides gratuity to its employees which are defined benefit plan. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

The gratuity plan typically exposes the Company to actuarial risks such as: investment risk, interest risk, longevity risk and salary risk.

Investment risk:

The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end of the reporting period on government bonds. For other defined benefit plans, the discount rate is determined by reference to market yield at the end of reporting period on high quality corporate bonds when there is a deep market for such bonds; if the return on plan asset is below this rate, it will create a plan deficit.

Interest risk:

A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset by an increase in the return on the plan debt investments.

Longevity risk:

The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan''s liability.

Salary risk:

The present value of the defined plan liability is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the plan''s liability.

1. The provision under Expected Credit Loss Model is higher than Income Recognition and Prudential Norms.

2. Customers who has availed the benefit of One-time restructuring as per RBI Circular RBI/2020-21/16 DOR.No.BP. BC/3/21.04.048/2020-21 dated August 2020 and RBI/2020-21/17 DOR.No.BP.BC/4/21.04.048/2020-21 dated August 2020 (for restructuring of accounts of Micro, small and Medium Enterprises (MSME) sector - Restructuring of Advances having exposure less than or equal to '' 25 crores) and RBI Notification - RBI/2021-22/31 DOR.STR.REC.11/21.04.048/2021-22 dated May 05, 2021 (Resolution Framework - 2.0: Resolution of Covid-19 related stress of Individuals and Small Businesses) have been disclosed as Stage 2 assets under Ind AS with gross outstanding value of '' 24,692 Lakh. Impairment provision and provision required under IRACP is maintained at 10% as required by RBI circular.

48. The Company periodically files returns/statements with banks and financial institution as per the agreed terms and they are in agreement with books of accounts of the Company. This information has been relied upon by the auditors.

49. Registration of charges or satisfaction with Registrar of Companies are filed and paid within the statutory period for debt and borrowings issued during the year.

50. Money raised by way of debt instruments and the term loans have been applied by the Company for the purposes for which they were raised, other than temporary deployment pending application of proceeds.

51. No proceedings have been initiated on or are pending against the Company for holding benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and Rules made thereunder.

52. None of the entities in the Company have been declared wilful defaulter by any bank or financial institution or government or any government authority.

53. The Company has no transactions with the companies struck off under Companies Act, 2013 or Companies Act, 1956.

54. The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

a. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (Ultimate Beneficiaries) or

b. provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries.

55. The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

a. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

b. provide any guarantee, security or the like on behalf of the ultimate beneficiaries

56. There is no income surrendered or disclosed as income during the current or previous year in the tax assessments under the Income Tax Act, 1961, that has not been recorded in the books of account.

57. In Compliance with Section 128 of the Companies Act, 2013 read with proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014, the Company uses an accounting software for maintaining its books of account which has a feature of recording audit trail (edit log) which has operated throughout the year for all relevant transactions recorded in the accounting software except that, audit trail feature was not enabled with respect to detail of changes made at the database level. This audit trail feature has been enabled at a database level post year end.

58. The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets or both during the current or previous year.

59. Exceptional item

During the previous year, the Company has accrued for one-time special bonus to its employees amounting to '' 2,500 Lakh that is debited to the Statement of Profit & Loss. Considering the nature, frequency, and materiality of the item it is treated as an exceptional item in the Statement of Profit & Loss.

60. There have been no instances of breach of covenants of loan availed or debt securities issued during the year ended March 31,2024.

61. Disclosure of details required as per Master Direction - Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021 dated February 17, 2021 - RBI/2020-21/73 DOR.FIN.HFC.CC.No.120/03.10.136/2020-21 and Master Direction - Reserve Bank of India (Non-Banking Financial Company - Scale Based Regulation) Directions, 2023 dated 19 October 2023 - RBI/DoR/2023-24/106 DoR.FIN.REC.No.45/03.10.119/2023-24:

1. The maturity analysis is prepared considering the prepayments on housing and other loans in line with historical trend. Classification of assets and liabilities under the different maturity buckets is based on the same estimates and assumptions as used by the company for compiling the return submitted to the RBI/NHB, which has been relied upon by the auditors.

2. The above-mentioned amount of Advances excludes interest accrued on loans, fair value of loans, ECL provision on stage 3 loans and EIR.

1. Amount disclosed under Commercial Real Estate includes non-housing loan which are provided against residential property.

2. The amount mentioned above for Total Exposure to Real estate sector excludes EIR and interest accrued on loans.

3. The amount mentioned above of Total own loan book amount excludes EIR and interest accrued on loans.

Note: Above does not include the provision for commission amounting to '' 147 Lakh (excluding disallowance of GST) for the year ended March 31,2024 which will be paid subject to approval in the ensuing Annual General Meeting. Commission paid during the year (FY 23-24) pertains to previous year (FY 22-23).

61.23 Net profit or Loss for the year, prior period items and changes in accounting policies

The financial statements have been prepared under historical cost convention on an accrual basis in accordance with the Indian Accounting Standards ("Ind AS") and the relevant provisions of the Companies Act, 2013 (the "Act") (to the extent notified). Same accounting policies have been followed for all period presented in these financial statements.

61.24 Revenue Recognition

There have been no instances in which revenue recognition has been postponed pending the resolution of significant uncertainties.

61.25 Consolidated Financial Statements (CFS)

Refer to the Consolidated Financial Statements for the relevant disclosures.

61.27 Insurance portion of Housing Loan is excluded from Housing Loan and regrouped in Other Property Loans (Refer Note 61.9, 61.26, 61.32, 61.38). The Insurance portion amounting to '' 59,094 Lakh (March 31, 2023: '' 53,821 Lakh) helps in mitigating the risk and secures the Company''s Loan portfolio against any eventuality.

61.28The Company has prepared the financial statements taking into consideration the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended ("Ind AS"), and other accounting principles generally accepted in India including the prevailing RBI/NHB regulations.

The Company has complied with the extant provisions of the applicable Ind AS for the purpose of asset classification based on credit risks and provisioning as per expected credit loss requirements during the financial year ended March 31, 2024. In respect of asset classification and provisioning requirements, the Company has complied with RBI Circulars dated March 13, 2020 on implementation of Indian Accounting Standards and have considered the impact of the RBI circulars during the year.

65. Previous year figures have been regrouped/re-classified wherever necessary to confirm to current year''s classification. The impact of such regrouping/ re-classification are not material to the Financial Statements.