Laxmi India Finance Ltd. ಖಾತೆಯ ಉಪಯುಕ್ತ ಮಾಹಿತಿ

L Provisions, Contingent Liabilities and Contingent
Assets:Provisions

Provisions are recognized when the Company has a
present obligation (legal or constructive) as a result
of a past event and it is probable that an outflow of
resources, that can be reliably estimated, will be
required to settle such an obligation.

If the effect of the time value of money is material,
provisions are determined by discounting the
expected future cash flows to net present value using
an appropriate pre-tax discount rate that reflects
current market assessments of the time value of
money and, where appropriate, the risks specific to the
liability. Unwinding of the discount is recognized in the
Statement of Profit and Loss as a finance cost.

When some or all of the economic benefits required
to settle a provision are expected to be recovered
from a third party, the receivable is recognized as an
asset if it is virtually certain that reimbursement will
be received and the amount of the receivable can be
measured reliably. The expenses relating to a provision
is presented in the statement of profit and loss net of
any reimbursement.

Provisions are reviewed at the end of each reporting
period and are adjusted to reflect the current best
estimate. If it is no longer probable that an outflow of
resources will be required to settle the obligation, the
provision is reversed.

Contingent Liabilities

A present obligation that arises from past events where
it is either not probable that an outflow of resources
will be required to settle or a reliable estimate of the
amount cannot be made, is disclosed as a contingent
liability. Contingent liabilities are also disclosed when
there is a possible obligation arising from past events,
the existence of which will be confirmed only by
the occurrence or non-occurrence of one or more
uncertain future events not wholly within the control
of the Company. Claims against the Company where
the possibility of any outflow of resources in settlement
is remote, are not disclosed as contingent liabilities.
Contingent liabilities are reviewed at each balance
sheet date.

Contingent Assets

Contingent assets are not recognised in financial
statements since this may result in the recognition of
income that may never be realised. A contingent asset
is disclosed, as required by Ind AS 37, where an inflow
of economic benefits is probable.

M Impairment of Non-Financial Assets:

At the end of each reporting period, the Company
reviews the carrying amounts of non-financial
assets other than deferred tax assets to determine
whether there is any indication that those assets have
suffered an impairment loss. If any such indication
exists, the recoverable amount of the asset is estimated
in order to determine the extent of the impairment loss
(if any).

Intangible assets with indefinite useful lives and
intangible assets not yet available for use are tested for
impairment at least annually and whenever there is an
indication that the asset may be impaired.

Recoverable amount is the higher of fair value less
costs of disposal and value in use. In assessing value
in use, the estimated future cash flows are discounted
to their present value using a pre-tax discount rate
that reflects current market assessments of the time
value of money and the risks specific to the asset for
which the estimates of future cash flows have not been
adjusted.

If the recoverable amount of an asset (or cash¬
generating unit) is estimated to be less than its carrying
amount, the carrying amount of the asset (or cash¬
generating unit) is reduced to its recoverable amount.
An impairment loss is recognised immediately in
Statement of Profit and Loss.

When an impairment loss subsequently reverses, the
carrying amount of the asset (or a cash-generating
unit) is increased to the revised estimate of its
recoverable amount, but so that the increased carrying
amount does not exceed the carrying amount that
would have been determined had no impairment
loss been recognised for the asset (or cash-generating
unit) in prior years. A reversal of an impairment loss is
recognised immediately in the Statement of Profit and
Loss.

N Cash and Cash Equivalents:

Cash and cash equivalents in the Balance Sheet
comprise cash at bank and in hand and short-term
deposits with banks that are readily convertible into
cash which are subject to insignificant risk of changes
in value and are held for the purpose of meeting short¬

term cash commitments and short term investments
with original maturity upto three month.

O Statement of Cash Flow:

Cash flows are reported using the indirect method,
whereby profit / (loss) before exceptional items and
tax is adjusted for the effects of transactions of non¬
cash nature and any deferrals or accruals of past or
future cash receipts or payments. The cash flows from
operating, investing and financing activities of the
Company are segregated.

P Trade and Other Receivable:

Trade and other receivables are amounts due from
customers for services performed in the ordinary
course of business. Trade and other receivables are
recognised initially at the amount of consideration
that is unconditional unless they contain significant
financing components, when they are recognised at
transaction price.

Q Recent Accounting Pronouncements:

Ministry of Corporate Affairs (''MCA'') notifies new
standards or amendments to the existing standards
under Companies (Indian Accounting Standards) Rules
as issued from time to time. For the year ended 31
March 2026, MCA has not notified any new standards
or amendments to the existing standards applicable to
the Company.

R Non-Current Assets (or disposal groups) classified

as held for sale:

Assets classified as held for sale are stated at the lower
of carrying amount and fair value less costs to sell.

An Asset is classified as "Asset held for sale” when the
asset is available for immediate sale and its sale is highly
probable. Such assets or group of assets are presented
separately in the Balance Sheet, in the line "Assets held
for sale” Once classified as held for sale, intangible
assets and PPE are no longer amortized or depreciated.

S Borrowing Costs:

General and specific borrowing costs that are
attributable to the acquisition or construction of a
qualifying asset are capitalised as part of the cost
of such asset till such time the asset is ready for its

intended use and borrowing costs are being incurred.
A qualifying asset is an asset that necessarily takes a
substantial period of time to get ready for its intended
use. The Company considers a period of twelve
months or more as a substantial period of time. All
other borrowing costs are recognised as an expense in
the period in which they are incurred.

Borrowing costs consist of (a) interest expense
calculated using the effective interest method as
described in Ind AS 109 - ''Financial Instruments'' (b)
finance charges in respect of leases recognized in
accordance with Ind AS 116 - ''Leases'' and (c) exchange
differences arising from foreign currency borrowings to
the extent that they are regarded as an adjustment to
interest costs.

Investment income earned on the temporary
investment of specific borrowings pending their
expenditure on qualifying assets is deducted from the
borrowing costs eligible for capitalisation.

T Segment Reporting: Identification of Segments:

An operating segment is a component of the Company
that engages in business activities from which it may
earn revenues and incur expenses, whose operating
results are regularly reviewed by the company''s Chief
Operating Decision Maker ("CODM”) to make decisions
for which discrete financial information is available.
Based on the management approach as defined
in Ind AS 108, the CODM evaluates the Company''s
performance and allocates resources based on an
analysis of various performance indicators by business
segments and geographic segments.

U Material prior period errors :

Material prior period errors are corrected retrospectively
by restating the comparative amounts for the prior
periods presented in which the error occurred. If the
error occurred before the earliest period presented, the
opening balances of assets, liabilities and equity for the
earliest period presented, are restated.

V Earnings per Share :

Basic earnings per share are calculated by dividing the
net profit or loss for the period attributable to equity
shareholders by the weighted average number of
equity shares outstanding during the period.

Diluted earnings per share are computed by dividing
the profit after tax as adjusted for dividend, interest
and other charges to expense or income (net of any
attributable taxes) relating to the dilutive potential
equity shares, by the weighted average number of
equity shares considered for deriving basic earnings
per share and the weighted average number of equity
shares which could have been issued on conversion of
all dilutive potential equity shares.

Note 1.3 Significant Estimates and Assumptions

The preparation of company''s financial statements
requires management to make judgements, estimates and
assumptions that affect the reported amounts of revenues,
expenses, assets and liabilities, and the accompanying
disclosures, and the disclosures of contingent liabilities.
Although these estimates are based upon management''s
best knowledge of current events and action, actual results
could differ from these estimates. These estimates are
reviewed regularly and any change in estimates are adjusted
prospectively.

In the process of applying the Company''s accounting
policies, management has made the following estimates,
assumptions and judgements, which have significant effect
on the amounts recognized in the financial statements:

(i) Business Model Assessment

The Company determines its Business Model at the
level that best reflects how it manages groups of
financial assets to achieve its business objectives.
The company considers the frequency, volume and
timing of disbursements in prior years, the reason
for such disbursement, and its expectations about
future business activities. However, information about
business activity is not considered in isolation, but as
part of an holistic assessment of how company''s stated
objective for managing the financial assets is achieved
and how cash flow are realized. Therefore the company
considers information about past disbursement in the
context of the reason for those disbursements, and
the conditions the existed at that time as compared
to current conditions. Based on this assessment

and the future business plans of the company, the
management has measured its financial assets at
amortized cost as the asset is held within a business
model whose objective is to collect contractual cash
flows, and the contractual terms of the financial assets
give rise to cash flows that are solely payments of
principle and interest (the SPPI criterion).

(ii) Property, Plant and Equipment & Intangible Assets

The determination of depreciation and amortization
charge depends on the useful lives which is based
on a number of factors including the effects of
obsolescence, demand, competition and other
economic factors (such as the stability of the industry
and known technological advances) and the level of
maintenance expenditures required to obtain the
expected future cash flows from the asset. The residual
values, useful lives, and method of depreciation of
property, plant and equipment and intangible assets
are reviewed at each financial year end and adjusted
prospectively, if appropriate.

Residual Value has been taken between 0-5%

Useful life of the all Property, Plant and Equipment and
Intangible assets are in accordance with Schedule II of
the Companies Act, 2013

(iii) Recognition and measurement of provisions and
contingencies

Management judgement is required for estimating
the possible outflow of resources, if any, in respect of
contingencies/claims/litigation against the company
as it is not possible to predict the outcome of pending
matters with accuracy.

(iv) Measurement of defined benefit obligations

The cost of defined benefit plan and present value
of such obligation are determined using actuarial
valuation. An actuarial valuation involves making
various assumptions that may differ from actual
developments in the future. These include the
determination of the discount rate, future salary
increases, mortality rates and attrition rate. Due to
the long-term nature of the plan, such estimates are
subject to significant uncertainty. All assumptions are
reviewed at each reporting date.

(v) Recognition of deferred tax

The recognition of deferred tax assets requires
assessment of whether it is probable that sufficient
future taxable profit will be available against which
deferred tax asset can be utilized. The Company reviews
at each balance sheet date the carrying amount of
deferred tax assets.

(vi) Impairment losses on financial assets

The measurement of impairment losses across all
categories of financial assets except assets valued at
Fair value through P&L (FVTPL), requires judgment, in
particular, the estimation of the amount and timing
of future cash flows and collateral values when
determining impairment losses and the assessment
of a significant increase in credit risk. These estimates
are driven by a number of factors, changes in
which can result in different levels of allowances.
The Company''s Expected credit loss (ECL) calculations
are outputs of complex models with a number of
underlying assumptions regarding the choice of
variable inputs and their interdependencies. Elements
of the ECL models that are considered accounting
judgments and estimates include:

• The Company''s model, which assigns Probability
of default (PD)s

• The Company''s criteria for assessing if there has
been a significant increase in credit risk and so
allowances for financial assets should be measured
on a Lifetime expected credit loss (LTECL) basis

• The segmentation of financial assets when their
ECL is assessed on a collective basis

• Development of ECL models, including the various
formulas and the choice of inputs

• Determination of associations between
macroeconomic scenarios and, economic inputs,
and the effect on PDs, Exposure at default (EAD)s
and Loss given default (LGD)s.

(vii) Fair value of financial instruments

When the fair values of financial assets and financial
liabilities recorded in the balance sheet cannot be
measured based on quoted prices in active markets,

their fair value is measured using valuation techniques
including the DCF model. The inputs to these models
are taken from observable markets where possible,
but where this is not feasible, a degree of judgment is
required in establishing fair values. Judgments include
considerations of inputs such as liquidity risk, credit
risk and volatility. Changes in assumptions about these
factors could affect the reported fair value of financial
instruments.

(viii) Effective Interest rate method

The Company''s EIR methodology, recognises interest
income using a internal rate of return that represents
the best estimate of a constant rate of return over
the expected behavioral life of loans and other
characteristics of the product life cycle (including
prepayments). This estimation, by nature, requires
an element of judgment regarding the expected
behaviour and life-cycle of the instruments, as well
other fee income/expense that are integral parts of the
instruments.

(ix) Determination of estimated useful lives of
property, plant and equipment and intangible
assets

Useful lives of property, plant and equipment and
intangible assets are based on the life prescribed in
Schedule II of the Act.

(x) Impairment of financial assets

The Company recognizes loss allowances for
Expected Credit Losses (ECL) on its financial assets
measured at amortized cost and Fair Value through
Other Comprehensive Income (FVOCI). At each
reporting date, the Company assesses whether
the above financial assets are credit- impaired.
A financial asset is ''credit- impaired'' when one or more
events that have a detrimental impact on the estimated
future cash flows of the financial asset have occurred.

(xi) Determination of lease term

Ind AS 116 Leases requires lessee to determine the
lease term as the non-cancellable period of a lease
adjusted with any option to extend or terminate the
lease, if the use of such option is reasonably certain.
The Company makes assessment on the expected
lease term on lease by lease basis and thereby assesses
whether it is reasonably certain that any options to
extend or terminate the contract will be exercised.
In evaluating the lease term, the Company considers
factors such as any significant leasehold improvements
undertaken over the lease term, costs relating to
the termination of lease and the importance of the
underlying to the Company''s operations taking into
account the location of the underlying asset and the
availability of the suitable alternatives. The lease term
in future periods is reassessed to ensure that the lease
term reflects the current economic circumstances.

(xii) Discount rate for lease liability and right of use
assets

The discount rate is generally based on the weighted
incremental borrowing rate specific to the lease being
evaluated or for a portfolio of leases with similar
characteristics. And discount rate of security deposits
is generally based on the SBI deposit rate at the time of
deposit.

Note 1.4 Foreign currency transactions:

Foreign currency transactions are translated into the
functional currency using the exchange rates at the dates of
the transactions. Foreign exchange gains and losses resulting
from the settlement of such transactions and from the
translation of monetary assets and liabilities denominated in
foreign currencies at year end exchange rates are recognised
in statement of profit and loss.

5.1 Secured Loans granted by the Company are secured by equitable mortgage/registered mortgage of the property and/or
hypothecation of Vehicle/Book Debts and other current assets.

5.2 The company has given impairment assessment and measurement approach in note no. 1

5.3 The company has defined risk assessment model in note no. 54

5.4 During the FY 25-26 there is no retained interest in Loans as part in Direct Assignment done before Date of Transition i.e.
Apr 1,2019

5.5 The Company has not granted any loans or advances in the nature of loans to promoters, directors, KMPs and the related
parties (as defined under the Companies Act, 2013), either severally or jointly with any other person that are (a) repayable
on demand or (b) without specifying any terms or period of repayment.

5.6 Summary of loans by stage distribution

9.1 During the F.Y 2025-26 and P.Y 2024-25 the Company has not revalued its Property, Plant and Equipment (including Right-
of-Use Assets).

9.2 The Company has elected to include ROU assets pertaining to lease of buildings as part of the property, plant and
equipment as permitted under paragraph 50 of Ind AS 116.

9.3 Details of immovable properties , whose title deeds have been pledged in favour of SBI Bank as security against Secured
Term loan has been explained in note 17.

17.2 Nature of Security

1. Secured term loans from banks amounting to Rs. 87,899.31 lakhs (FY25 Rs 67563.43 Lakhs). The loans are having tenure
of 3 to 7 years from the date of disbursement and are repayable in both monthly and quarterly installments. Those loan
are secured by hypothecation(exclusive charge) of the loans given by the Company and Personal Guarantee of Directors
and Corporate Guarantee of Starpoint Constructions Pvt Ltd, Hirak Vinimay Pvt Ltd, Deepak Hitech Motors Private Limited
& Dreamland Buildmart Private Limited. Loan sanctioned by State bank of India is further secured by hard collateral in the
form of property.

2. Secured term loans from banks amounting to Rs.155.74 lakhs (FY25 Rs 60.70 Lakhs). The loans are having tenure of 3 to 7
years from the date of disbursement and are repayable in monthly installments. Those loan are secured by hypothecation
(exclusive charge) of vehicle owned by the Company and personal guarantee of directors.

3. Secured term loans from NBFC/FIs amount to Rs. 38,355.52 lakhs (FY25 Rs 41820.97 Lakhs). The loans are having tenure of
3 years to 5 years from the date of disbursement and are repayable in both monthly and quarterly installments. Those loan
are secured by hypothecation (exclusive charge) of the loans given by the Company and Personal Guarantee of Directors
and Corporate Guarantee of Starpoint Constructions Pvt Ltd, Hirak Vinimay Pvt Ltd, Deepak Hitech Motors Private Limited
and Prem Dealers Private Limited.

4. Secured term loans from NBFC/FIs amount to Rs. 32.71 lakhs ( FY25 Rs 40.71 Lakhs).The loans are having tenure of5 years from
the date of disbursement and are repayable in monthly installments. Those loan are secured by hypothecation(exclusive
charge) of vehicle owned by the Company.

5. Overdraft borrowings from the bank amounting to Rs. 0.84 lakhs (FY25 Rs 0.00 Lakh) are secured by the company, are
repayable on demand and carry an interest as Interest Spread of 0.60% over and above Interest Rate on Underliened Fixed
Deposit.

6. Cash Credit from the bank amounting to Rs. 0.00 lakhs (FY25 Rs. 0.00 Lakhs) are secured by the company, are repayable on
demand and carry an interest ranging between 11.15% to 12.50%.Those cash credits are secured by hypothecation(exclusive
charge) of the loans given by the Company and Personal Guarantee of Directors.

7. Associated liabilities in respect of Co-Lending Transaction represents amounts received in respect of Co-Lending
Transaction(net of repayments and investment therein) as these transactions do not meet the derecogniton criteria
specified under IND AS. These are secured by way of hypothecation of designated loans assets receivables.

17.3 The company has no default in the repayment of dues to its lenders

17.4 The company has used all the borrowings from banks and financial institutions for the specific purpose for which it was
taken , except temporary deployment pending application of proceeds during the period/year ended on March 31,2026
and March 31,2025.

17.5 In regard to Borrowings from banks or financial institutions on the basis of security of current assets, :

a) Quarterly returns/statements of current assets filed by the Company with banks or financial institutions are in
agreement with the books of accounts,

b) since above point (a) is affirmative, hence summary of reconciliation and reasons of material discrepancies is not
applicable.

17.6 The Company has not been declared as Wilful Defaulter during the period/year ended on March 31,2026 and March 31,
2025.

*During the year ended 31 March 2026, the Company has completed an Initial Public Offer ("IPO”) of 1,60,92,195 equity
shares of face value of INR 5 each at an issue price of INR 158 per equity share (INR 153 per equity share premium),
comprising of offer for sale of 56,38,620 equity shares by selling shareholders and fresh issue of 1,04,53,575 equity shares.
The equity share of the company were listed on Bombay Stock Exchange Limited ("BSE”) and National Stock Exchange of
India Limited ("NSE”) on 5th August 2025.

* Change in number of shares during the year include issue of 10,44,362(before split) right shares and share split impact of
opening shares and right issue during the year FY 2024-25

(b) Rights, Preferences and Restrictions attached to equity shares

The Company has only one class of equity shares having a par value of '' 5 per share. Each shareholder is entitled to one
vote per equity share.

The Board of Directors of the Company in its meeting held on November 13 2024 and approved the sub-division of
shares from '' 10 per share to '' 5 per share and the Shareholder in their General Meeting held on November 16 2024 also
approved the sub-division of shares.

The Company had formulated and implemented a policy i.e. Laxmi India Finance Private Limited Employee Stock Option
Plan 2023 approved by the shareholders on August 12, 2023 which was amended and replaced by Laxmi India Finance
Limited Employee Stock Option Plan 2023 by the shareholders on November 29, 2024. The Nomination and Remuneration
Committee (NRC) of the Board of Directors of the Company, inter alia, administers and monitors the Plan in accordance
with the provisions of Companies Act, 2013 and rules made thereunder. The company has granted ESOP options, and the
grant date is October 01,2024.

(c) Details of shares in respect of each class in the company held by its holding company or its ultimate holding
company

No Holding company of the company.

36. The Company has not traded or invested in Crypto currency or Virtual Currency during period ending March 31,2026 and
March 31,2025.

37. The Company held no Benami Property during the period ending March 31,2026 and March 31,2025.

38. The Company has no transactions with the companies struck off under section 248 of Companies Act, 2013 or section 560
of Companies Act, 1956.

39. Registration of charges or satisfaction with Registrar of Companies (ROC)

There are no charges or satisfaction yet to be registered with ROC beyond the statutory period.

40. Non Compliance with the number of layers prescribed under clause (87) of section 2 of the Act read with Companies
(Restriction on number of Layers) Rules, 2017 : Not Applicable.

41. Disclosure in regard to Compliance with approved Scheme(s) of Arrangements : Not Applicable

42. Utilisation of Borrowed funds and share premium:

No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources
or kind of funds) by the Company to or in any other person(s) or entity(ies) including foreign entities ("Intermediaries”)
with the understanding whether recorded in writing or otherwise that the Intermediary shall lend or invest in party
identified by or on behalf of the Company (Ultimate Beneficiaries). The Company has not received any fund from any
party(s) (Funding Party) with the understanding that the Company shall whether directly or indirectly lend or invest in
other persons or entities identified by or on behalf of the Company ("Ultimate Beneficiaries”) or provide any guarantee
security or the like on behalf of the Ultimate Beneficiaries

43. There is no any transactions which are not recorded in the books of accounts and has been surrendered or disclosed as
income during the year in the tax assessments under the Income Tax Act, 1961

44. Disclosure as per Ind AS 7 “Cash Flow Statement"

Cash and non-cash changes in liabilities arising from financing activities:

Notes-

(a.1) Demand of Rs 8.65 lakhs has been raised by department for AY 2020-21 on the ground that deduction u/s 80JJAA was not
in order. Appeal to the Joint Commissioner (Appeals) has been preferred for the same.

(a.2) Income Tax Department has raised demand amounting to Rs 158.24 lakhs under Section 148 of Income Tax Act and on
which interest amount levy of Rs 4.75 lakhs for the FY 2014-15, against which company has filed CIT appeal. Once the
appeal got approved, demand amount will be waived off. Hence company has created contingent liability.

(b) During the year the company has sanctioned loans to various customers. Some loan are partially disbursed and required
to be fully disbursed if all basic requirements get fulfilled by the counter party

A) Defined Contribution Plans

The Company makes Provident Fund and Employee State Insurance Scheme contributions which are defined contribution
plans for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the
payroll costs to fund the benefits.

The contributions payable to these plans by the Company are at rates specified in the rules of the Schemes.During the
year company has recognised the following amounts in the statement of profit and loss account:

B) Defined Benefit plan - Gratuity

The Company accounts for the liability for future gratuity benefits based on an actuarial valuation. The net present value
of the Company''s obligation is actuarially determined based on the projected unit credit method as at Restated Summary
Statements dates.

Based on the actuarial valuation obtained in this respect, the following table sets out the status of the gratuity plan and
the amounts recognized in the company''s Financial Statements as at Balance sheet date:

* These Sensitivities have been calculated to show the movement in defined benefit obligation in isolation and assuming
there are no other changes in market conditions at the accounting date. There have been no changes from the previous
periods in the methods and assumptions used in preparing the sensitivity analyses. This analysis may not be representative
of the actual change in the defined benefit obligations as it is unlikely that the change in assumptions would occur in
isolation of one another as some of the assumptions may be correlated.

According to the company policy, Leave balances are carried forward based on the accruals and availments/ encashments
done during the year in accordance with the company policy and accordingly, any excess balance of leave outstanding as
at year end is lapsed as at March 31,2026 and March 31,2025.

Provision of a defined benefit scheme poses certain risks as companies take on uncertain long term obligations to make
future pension payments as follows:

Liability Risk

a) Asset-Liability Mismatch Risk - Risk if there is a mismatch in the duration of the assets relative to the liabilities. By
matching duration with the defined benefit liabilities, the company is successfully able to neutralize valuation swings
caused by interest rate movements. Hence companies are encouraged to adopt asset-liability management.

b) Discount Rate Risk - Variations in the discount rate used to compute the present value of the liabilities may seem
small, but in practice can have a significant impact on the defined benefit liabilities.

c) Future Salary Escalation and Inflation Risk - Since price inflation and salary growth are linked economically, they
are combined for disclosure purposes. Rising salaries will often result in higher future defined benefit payments
resulting in a higher present value of liabilities especially unexpected salary increases provided at management''s
discretion may lead to estimation uncertainties increasing this risk.

Unfunded Plan Risk

a) This represents unmanaged risk and a growing liability. There is an inherent risk here that the company may default
on paying the benefits in adverse circumstances. Funding the plan removes volatility from the balance sheet and
better manages defined benefit risk through increased returns.

* These Sensitivities have been calculated to show the movement in defined benefit obligation in isolation and
assuming there are no other changes in market conditions at the accounting date. There have been no changes
from the previous periods in the methods and assumptions used in preparing the sensitivity analyses. This analysis
may not be representative of the actual change in the defined benefit obligations as it is unlikely that the change in
assumptions would occur in isolation of one another as some of the assumptions may be correlated.

According to the company policy , leave balances are not carried forward to next years and any balance of leave
outstanding as at year end is lapsed, therefore there is no provision for leave encashment as at March 31,2026 and
March 31,2025.

Valuations are based on certain assumptions, which are dynamic in nature and vary over time. As such
company is exposed to various risks as follow :

a) Changes in Discount rate - Reduction in discount rate in subsequent valuations can increase the plan''s liability.

b) Salary increase risk - Actual salary increases will increase the Plan''s liability. Increase in salary increase rate
assumption in future valuations will also increase the liability.

c) Life expectancy - Actual deaths & disability cases proving lower or higher than assumed in the valuation can
impact the liabilities.

d) Withdrawals - Actual withdrawals proving higher or lower than assumed withdrawals and change of withdrawal
rates at subsequent valuations can impact Plan''s liability.

Effective November 21,2025, the Govenment 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 collectively referred to as the ''New Labour Codes'' - consolidating 29 existing labour laws. The
Ministry of Labour & Employment has published draft Central Rules and FAQs on December 30. 2025, to facilitate
assessment of the financial impact arising from these regulatory changes. Under IND AS 19, changes to employee
benefit plans arising from the New Labour Codes constitute plan amendments and they are required to be treated
as past service costs and recognised as an expense in the statement of profit and loss. Accordingly, the New Labour
Codes has resulted in an estimated increase in provision for employee benefits of Rs 44.67 lakhs as on 31st Dec 2025
and the same has been recognized under the head ''Employee Benefit Expenses in the year ended March 31,2026,The
Company continues to monitor the finalisation of Central & State Rules and clarifications from the Government

A. Share Option Plans (Equity-settled)

The Company had formulated and implemented a policy i.e. Laxmi India Finance Private Limited Employee Stock Option
Plan 2023 approved by the shareholders on August 12, 2023 which was amended and replaced by Laxmi India Finance
Limited Employee Stock Option Plan 2023 by the shareholders on November 29, 2024. The Nomination and Remuneration
Committee (NRC) of the Board of Directors of the Company, inter alia, administers and monitors the Plan in accordance
with the provisions of Companies Act, 2013 and rules made thereunder. The company has granted ESOP options and the
grant date is October 01,2024.

Out of options granted, 20% shares will vest at the end of Twelve months from the date of grant, 20% at the end of the
Twenty-Four months, 30% at the end of the Thirty-Six months and balance 30% at the end of Forty-Eight months. The fair
value of the options will be estimated at the grant date using a Black-Scholes pricing model, taking into account the terms
and conditions upon which the ESOP were granted.

The fair value of the option is determined using a Black-Scholes options pricing model. During the year ended March 31,
2026 Rs 64.84 lakh (March 31,2025 Rs. 41.03 lakhs) has recognised to the Company''s statement of profit and loss in respect
of equity-settled share-based payments transactions.

53. Transfer Of Financial Assets53.1 Transfer of Financial Assets that do not result in derecognition:Securitisation :

During FY 2018-19, the Company had transferred its receivables through securitisation agreement with a first loss default
guarantee (FLDC) . The company has also agreed to provide servicing assistance to the transferee pursuant to the terms of
servicing agreement. During FY 22-23 Securitisation transaction had been closed

During the period/year March 31, 2026 and March 31, 2025 the company has not entered into securitisation transactions for
other than stressed asset.

53.2 Transfer of financial assets that are derecognised:Assignment Deal:

After Date ofTransition to Ind AS i.e Apr 1,2019 ,the Company has sold some loans and advances measured at amortised cost as
per assignment deals, as a source of finance. As per the terms of these deals, since substantial risk and rewards related to these
assets were transferred to the buyer, the assigned portion of assets have been decognised from the Company''s balance sheet.

The management has evaluated the impact of assignment transactions done during the year for its business model. Based on
the future business plan, the Company business model remains to hold the assets for collecting contractual cash flows.

The table below summarises the carrying amount of the derecognised financial assets measured at amortised cost and the gain
on derecognition, per type of asset.

53.3 Co- Lending

The Company has entered into an agreement for Co-Lending, due to risk associate with such portfolio didn''t derecognised loan
portfolio from the loan books.

As per IGAAP, these asset are required to be derecognise proportionately.

As per Ind AS, the asset should not be derecognised untill and unless associated risk are not transferred entirely.

Company has entered Co-lending Arrangement in FY 2025-26. Disclosure As per Reserve Bank of India (Non-Banking Financial
Companies - Transfer and Distribution of Credit Risk) Directions, 2025 RBI/DOR/2025-26/352 DOR.STR.REC.271/21.04.048 /2025-
26 Dated on Nov 28, 2025 for the Year ended March 31,2026 for the loans under the Co-lending arrangement are given Below:

53.4 Business Corrrespondent

The Company has entered into Business Correspondent transaction and didn''t recognised loan portfolio in the books as
associated risk is not with company.

54. Disclosure as per Ind AS-107 ''Financial Instruments''

Financial Risk Management

The Company''s Principal financial liabilities comprise borrowings. The main purpose of these financial liabilities is to finance the
Company''s operations. At the other hand company''s Principal financial assets include loans and cash and cash equivalents that
derive directly from its operations.

As a lending institution, Company is exposed to various risks that are related to lending business and operating environment.
The Principal Objective in Company''s risk management processes is to measure and monitor the various risks that Company is
subject to and to follow policies and procedures to address such risks. The Company''s risk governance structure operates with a
robust board and risk management committee with a clearly laid down charter and senior management direction and oversight.
The board oversees the risk management process and monitors the risk profile of the company directly as well as through its sub
committees including the Audit Committee, the Asset Liability Supervisory Committee and the Risk Management Committee.
The key risks faced by the company are liquidity risk, credit risk, Concentration risk, market risk, interest rate risk and Operational
Risk.

Company is exposed to following risk from the use of its financial instrument:

Liquidity Risk : The Company maintains adequate reserves, ensures access to committed credit facilities, and continuously
monitors both forecasted and actual cash flows to safeguard financial stability.

Market Risk : The Company is exposed to market risk arising from fluctuations in interest rates, which may affect borrowing
costs and the valuation of financial assets.

A Risk management framework

The Company''s board of directors has overall responsibility for the establishment and oversight of the Company''s risk
management framework. The board of directors has established the risk management committee. The risk management
committee of board exercises supervisory power in connection with the risk management of the Company, developing
and monitoring risk management policies, monitoring of the exposures, reviewing adequacy of risk management process,
ensuring compliance with the statutory/regulatory framework of the risk management process. The Company''s risk
management policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits

and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly
to reflect changes in market conditions and the Company''s activities.

B. Credit risk

Credit risk arises when a borrower is unable to meet financial obligations under the loan agreement to the Company. This
could be either because of wrong assessment of the borrower''s repayment capabilities or due to uncertainties in future.
The effective management of credit risk requires the establishment of appropriate credit risk policies and processes.

Loan Asset:

The company has comprehensive and well-defined credit policies across all products and segments, which are backed
by analytics and technology for mitigating the risks associated with them. Company has developed "Credit scoring
model” which uses quantitative measures of the performance and characteristics of past loans to predict the future
performance of loans with similar characteristics. It is a statistical method of assessing the credit risk associated with new
loan applications. Various Parameters or risk identifiers of this function are empirically designed; that is, they are developed
entirely from information and experience gained through prior experience. It is the set of decision models and their
underlying techniques that aid the company in determining to ascertain the credit worthiness of a potential customer
and also fairly price credit risks. It is an objective risk assessment/identification tool, as opposed to subjective methods that
rely on a credit underwriter''s opinion. It helps the company in taking credit decisions in a consistent manner.

Company gives due importance to prudent lending practices and have implemented suitable measures for
risk mitigation, which include verification of credit history from credit information bureaus, cash flow analysis,
physical verifications of a customer''s business and residence and field visits and required term cover for insurance.
The company has a robust post sanction monitoring process to identify credit portfolio trends and early warning signals.

(i) Credit quality analysis

Refer Note no. 5

(ii) Collateral And Other Credit Enhancements

The Company offers loan to customers which includes both unsecured loan and loans secured by collaterals.
Although collateral can be an important mitigation of credit risk, it is the Company''s policy to lend on the basis of
the customer''s ability & intention to meet the repayment obligations out of cash flow resources other than placing
primary reliance on collateral and other credit risk enhancements. The company obtains first and exclusive charge on
all collateral for the loans given. MSME & LAP Loan are secured against immovable Property at the time of origination
and Vehicle Loans are secured against Vehicles. The value of the property/Vehicle at the time of origination will be
arrived by obtaining valuation report from Company''s empanelled valuers. Security Interest in favour of the Company
is created through deposit of title deed by equitable or registered Mortgage in case of Immovable Property and
Registering Hypothecation in case of Vehicle. For Additional Security Purpose, Guarantee from third party also been
taken in most cases.

The company does not obtain any other form of credit enhancement other than the above. All the loans are secured
by way of tangible Collateral. Any surplus remaining after Settlement of outstanding debt by way of sale of collateral
is returned to the borrower.

(iii) Concentration of Risk/Exposure

Concentration of credit risk arise when a number of counterparties or exposures have comparable economic
characteristics, or such counterparties are engaged in similar activities or operate in same geographical area or
industry sector so that collective ability to meet contractual obligations is uniformly affected by changes in economic,
political or other conditions.

Vehicle Finance segment (consisting of new and used Commercial Vehicles, Passenger Vehicles, Tractors and
Construction Equipment) is lending against security of hypothecation on underlying vehicle and contributes to 9%
to 11% approx of the loan book of the Company as of March 31, 2026, 17%-19 % approx of the loan book of the
Company as of March 31, 2025, . Portfolio is reasonably well diversified across 6 states of the country i.e. Rajasthan,
Gujrat , Madhya Pradesh, Chattisgarh, Uttar Pradesh and Maharashtra in year ended March 31,2026 and 4 state of the
country i.e. Rajasthan, Gujrat, Madhya Pradesh, and Chattisgarh in year ended March 31,2025. Similarly, sub segments
within Vehicle Finance like Heavy Commercial Vehicles, Light Commercial Vehicles, Car and Multi Utility Vehicles,
three wheeler and Small Commercial Vehicles, Electric vehicle, Tractors and Construction Equipment have sufficient
portfolio share leading to well diversified product mix.

MSME & Loan against Property segment contributes to 84%-86% approx of the lending book of the company as of
March 31,2026, 80%-82% approx of the lending book of the company as of March 31, 2025. Portfolio is diversified
and distributed sufficiently across 6 states of the country i.e. Rajasthan, Gujarat, Madhya Pradesh, Chattisgarh, Uttar
pradesh and Maharashtra. in year ended March 31, 2026 and 4 state of the country i.e. Rajasthan, Gujrat, Madhya
Pradesh, and Chattisgarh in year ended March 31,2025.

The Concentration of risk is managed by company for each product by its region and its sub segments. Company did
not overly depend on few regions or sub-segments as of March 31,2026 March 31,2025

(iv) Amounts arising from ECL

(a) Inputs, assumptions and techniques used for estimating impairment
Inputs considered in the ECL model:

In assessing the impairment of financial loans under expected credit loss (ECL) model, the assets have been segmented
into three stages. The three stages reflect the general pattern of credit deterioration of a financial instrument. The
differences in accounting between stages, relate to the recognition of expected credit losses and the measurement
of interest income.

The Company categorizes loan assets into stages primarily based on the months past due status.

The Company applies the general approach to providing for expected credit losses prescribed by Ind AS 109, which
permits the use of the lifetime expected loss provision for advances other than stage 1. The Company has computed
expected credit losses based on a provision matrix which uses historical credit loss experience and using forward
looking economic variables of the Company.

Assessment of significant increase in credit risk (SICR):

The credit risk on a financial asset of the Company is assumed to have increased significantly since initial recognition
when contractual payments are more than 30 days past due. Accordingly the financial assets shall be classified as
stage 2, if on the reporting date, it has been past due for more than 30 days.

In determining whether credit risk has increased significantly since initial recognition, the Company uses days past
due information, early warning signals (EWS) in terms of unusual events including incidents and frauds, repossession
of an asset, etc. and forecast information to assess deterioration in credit quality of a financial asset.

Definition of default

The Company considers a financial asset to be in "default” and therefore stage 3 (credit impaired) for ECL calculations
when the borrower becomes 90 days past due on its contractual payments.

Exposure at default

The Exposure at Default is an estimate of the exposure at a future default date. It is outstanding exposure on which
ECL is computed. EAD includes principal outstanding, Interest overdue and interest Accrued as on reporting date as
reduced by excess money and Pending disbursement

Estimations and assumptions considered in the ECL model

The Company has made the following assumptions in the ECL Model:

(1) Probability of default (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.

PD estimation process is done based on historical internal data available with the Company. While arriving at
the PD, the Company also ensures that the factors that affects the macro economic trends are considered to a
reasonable extent, wherever necessary.

For Stage I accounts, 12 months PD is used.

For Stage II significantly increased credit risk accounts, Lifetime PD is used which is computed based on survival
analysis.

For Stage III credit impaired accounts, 100% PD is taken.

(2) Loss Given Default (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 Company would expect to
receive, including from the realisation of any collateral. It is usually expressed as a percentage of the EAD. LGD is
the loss factor which the Company may experience in case the default occurs.

Policy for write-off of financial assets

Financial assets are written off either partially or in their entirety when there is no realistic prospect of recovery.
This is generally the case when the Company determines that the borrower does not have assets or sources of
income that could not generate sufficient cash flows to repay the amounts.

(b) An analysis of changes in gross carrying amount and related Impairment Loss Allowance (ECL) defined in
note no. 5

(iii) Liquidity Risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial
liabilities that are settled by delivering cash or another financial asset. The objective of Liquidity risk management is to
maintain sufficient liquidity and ensure that funds are available for use as per requirement. Liquidity risk may arise because
of the possibility that the company might be unable to meet its payment obligations when they fall due as a result of
mismatches in the timing of the cash flows under both normal and stress circumstances caused by a difference in the
maturity profile of Company assets and liabilities. This risk may arise from the unexpected increase in the cost of funding

an asset portfolio at the appropriate maturity and the risk of being unable to liquidate a position in a timely manner and
at a reasonable price.

The Company''s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to
meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking
damage to the Company''s reputation.