Directors Report of Star Housing Finance Ltd.

Mar 31, 2025

The Board of Directors are pleased to present the Company''s Twentieth Director''s Report and the Audited Financial
Statement for the Financial Year (“FY”) ended March 31, 2025.

COMPANY OVERVIEW

Star Housing Finance Limited (“Star HFL”) is BSE listed rural focused housing finance company operational in the
affordable housing finance space helping achieve the dreams of the first-time home buyers from the Economic Weaker
Section / Low Income Group to own their first house through simple and easy processes.

Since the commencement of our home loan business operations in Sep 2009, Star HFL has worked with the intent to
enable homeownership through providing housing finance to target EWS/LIG customers in semi-urban and rural
geographies. Star HFL is managed by a team of experienced housing finance professionals with strong domain at
experience at regional and national level. Star HFL offers retail home loans up to INR 25 lakhs.

FINANCIAL SUMMARY OR HIGHLIGHTS/PERFORMANCE OF THE COMPANY

The Company''s financial performance for the Financial Year ended March 31, 2025, is summarized as below:

PARTICULARS	YEAR ENDED 31 MARCH, 2025	YEAR ENDED 31 MARCH, 2024
Gross Income	9,496.27	6,163.55
Less : Finance Cost	4,649.05	2,782.78
Employee Benefit Exp.	1,857.46	1,320.53
Overhead	976.80	666.15
Depreciation	81.68	66.71
Impairment of Financial instruments	512.47	180.26
Profit Before Tax	1,418.81	1147.12
Less : Provision for taxation	308.90	258.79
Profit After tax	1,109.91	888.33
Balance Brought Forward from last year	2,243.30	1,627.49
Appropriations	1,109.91	888.33
Transfer from ESOP Reserve	236.29	-
Transferred to Statutory Reserve under Section 36(1)(viii) of the Income Tax Act, 1961 read with Section 29C of National Housing Bank Act, 1987	283.76	229.42
Transferred to General Reserve	-	-
Others	73.56	43.10
Balance Carried over to the Balance Sheet	3,232.18	2,243.30
Return on Net Worth (%)	8.02%	7.42%
Return on Total Assets (%)	2.12%	2.29%
EPS (Rs.)	1.41	1.14
Debt Equity Ratio (times)	2.81	2.41
Average Cost of Funds (%)	12.78%	11.50%
Average Yield on advances (%)	19.24%	16.96%
Net Interest Margin (%)	7.69%	7.86%

KEY FACTORS	2024-25	2023-24	GROWTH (%)
Loan Portfolio (Rs. In Lakhs)	52,069.78	42,686.39	21.98%
EPS (Basis) (in Rs)	1.41	1.14	23.20%
CRAR (%)	50.55%	54.65%	-7.51%

Note: Figures of the previous year/ period have been regrouped and/or reclassified whenever necessary while preparing the statement as per
IND-AS requirements.

DIVIDEND

The Company has in place a Dividend Distribution Policy formulated in accordance with the Securities and Exchange
Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“Listing Regulations”), which
intends to ensure that a rationale decision is taken, with regard to the amount to be distributed to the shareholders as
dividend, after retaining sufficient funds for the Company''s growth, to meet its long-term objective and other purposes.
The Policy also lays down various parameters to be considered by the Board of Directors of the Company before
recommendation of dividend to the Members of the Company.

Considering the performance of the Company during the financial year 2024-2025, the Board of Directors felt the need
to strike a balance between being prudent and conserving capital in the Company, while at the same time catering to
the expectations of shareholders and also considering the Dividend Distribution Policy and in terms of RBI Circular No.
DOR.ACC.REC.No.23/21.02.067/2021-22 dated 24th June, 2021, have recommended payment of final dividend amounting
to Rs. 0.10 per equity share of Rs.5/- for the financial year ended March 31, 2025 in its meeting held on 14th August 2025.
The dividend payable shall be subject to the approval of the Members at the ensuing twentieth Annual General Meeting
(‘AGM'') of the Company.

The dividend declared by the Company for the Financial Year ended 31st March, 2025 is in compliance with the Dividend
Distribution Policy of the Company. The Dividend Distribution Policy is available on the website of the Company at
https://www.starhfl.com/wp-content/uploads/2024/08/Dividend-Distribution-Policy.pdf

TRANSFER TO RESERVES

During the year under review, your Company appropriated Rs. 283.76 Lakhs to the Statutory Reserve under Section
36(1) (viii) of the income Tax Act, 1961 read with Section 29C of National Housing Bank (NHB) Act, 1987 out of the
amount available for appropriation and an amount of Rs. 1,109.91 Lakhs is proposed to be retained in the Profit and Loss
Account.

SHARE CAPITAL

Authorized Share Capital

During the year, the company''s Authorized share capital remain unchanged. Hence, the authorized share capital of the
Company as at March 31, 2025 is Rs. 50,00,00,000/- (Rupees Fifty Crore only) consisting of 10,00,00,000 (Ten Crore)
equity shares of Rs. 5/- (Rupees Five) each.

Issued and Paid-up Capital

The paid-up Equity Share Capital of the Company at on March 31, 2025 is Rs. 39,48,19,740/- (divided into 7,89,63,948
Equity Shares of Rs. 5/- each).

During the year under review:

1) The Board of Directors of the Company in their meeting held on 18th June, 2024 has allotted 60,000 fully paid up
equity shares of face value Rs. 5/- each under “Akme Employee Stock Option Plan 2021.” A certificate from the Secretarial
Auditors on the implementation of your Company''s ESOP will be available at the ensuing Annual General Meeting
(“AGM”) for inspection by the Members. The disclosure with regard to ESOP as required under the SEBI (Share Based
Employee Benefits and Sweat Equity) Regulations 2021 is available on the website of the Company at www.starhfl.com
and also disclosed in the accompanying financial statements.

2) The Board of Directors of the Company in their meeting held on 25th July, 2024 has issued and allotted 1,83,332 Equity
Shares of Rs. 5/- each at an issue price of Rs. 64/- per Equity Share including share premium of Rs. 59/- per equity share,
against exercise of Warrants.

Changes after the Financial Year:

Lapse of Warrants and Forfeiture of Subscription Amount:

The Company had allotted 93,78,500 warrants on December 28, 2023, at an issue price of Rs. 64/- per warrant, each
convertible into one equity share. The warrants issued carried an exercise period of 18 (Eighteen) months within which
the warrant holders must exercise their right.

In line with the above, during the year under review, 1,83,332 equity shares of Rs. 5/- each were allotted upon exercise
of warrants on July 25, 2024, at an issue price of Rs. 64/- per share, including a share premium of Rs. 59/- per share. The
remaining unexercised warrants got lapsed upon expiry, and the 25% upfront subscription amount paid by the allottees
was forfeited by the Company.

Apart from above, the Company has not issued any shares or convertible securities.

EMPLOYEE STOCK OPTION PLAN

a) During the year under review, your Company has allotted 60,000 Equity Shares under the “Akme Employee Stock
Option Plan 2021” to the eligible Employee of the Company on June 18, 2024.

Total 30,19,700 options under the “Akme Employee Stock Option Plan 2021” are available for future grants as these
were not exercised by the employees within the exercise period and were added back to the pool of the scheme for
grant in future. 1,20,000 options are yet to exercise under the said scheme.

b) During the year under review, your Company has granted 77,00,000 stock options (convertible into 77,00,000 Equity
Shares of the company, upon exercise ) under “Star Housing Finance Limited Employee Stock Option II 2023” (“ESOP
2023”/ “Plan”) to the Eligible employees of the Company. However, all the granted options were surrendered by the
eligible employees. These ESOPs are added back to the pool of the scheme for grant in future.

CREDIT RATING

The following ratings have been reaffirmed/assigned to the Company for its Bank Loan and Non-Convertible
Debentures (NCDs) during the Year by India Ratings & Research Agency & Care Edge Ratings Agency:

SR. NO.	NAME OF RATING AGENCY	FACILITIES	LIMITS (IN MILLION)	TENURE	RATING	RATING ACTION
1	India Ratings & Research Agency	Bank Loan	INR 4500	Long Term	IND BBB/Stable	Affirmed
2	India Ratings & Research Agency	Non-Convertible Debentures (NCDs)	INR 500	Long Term	IND BBB/Stable	Affirmed

SR. NO.	NAME OF RATING AGENCY	FACILITIES	LIMITS (IN MILLION)	TENURE	RATING	RATING ACTION
1	CARE Ratings Limited	Long-term bank facilities	INR3000	Long Term	CARE BBB; Stable	Reaffirmed

The following ratings have been reaffirmed/assigned to the Company for its bank facilities after the Closure of financial
Year by India Ratings & Research Agency

SR. NO.	NAME OF RATING AGENCY	FACILITIES	LIMITS (IN MILLION)	TENURE	RATING	RATING ACTION
1	India Ratings & Research Agency	Bank Loan	INR 4500	Long Term	IND BBB/Stable	Affirmed
2	India Ratings & Research Agency	Non-Convertible Debentures (NCDs)	INR 500	Long Term	IND BBB/Stable	Affirmed

TERM LOANS

A. BANKS AND FINANCIAL INSTITUTIONS

During the Financial Year 2024-25, your company raised term loans of Rs. 175 crores from the following institutions:

SR. NO	NAME OF THE INSTITUTION	AMOUNT RAISED (RS. IN LAKHS)
1	Indian Overseas Bank	1,000
2	Mas Financial Services Limited	5,000
3	Northern Arc Capital Limited	2,000
4	Poonawala Fincorp Limited	1,000
5	Shriram Finance	1,000
6	Sundaram Finance Ltd	1,500
7	Suryoday Small Finance Bank	1,000
8	Bajaj Finance Ltd	2,000
9	LIC Housing Finance Limited	2,500
10	ESAF Small Finance Bank	500
	TOTAL	17,500

The Outstanding Borrowings (other than debt securities) as on March 31, 2025 stood at Rs. 38118.23 Lakhs.

B. NON-CONVERTIBLE DEBENTURES (NCDs)

The details of outstanding NCDs of the Company as on March 31, 2025 is as follows:

SECURITY DESCRIPTION	ISIN	INTEREST RATE	FACE VALUE PER NCD (IN RS)	OUTSTANDING PRINCIPAL AMOUNT (IN RS.)
2,000 Secured Redeemable Non-Convertible Debentures (NCD)	INE526R07017	13.10%	1,00,000	11,90,47,619
1,100 Senior, Secured, Rated, Listed, Transferable, Redeemable, Taxable, Non-Convertible Debentures	INE526R07025	13.35%	1,00,000	11,00,00,000

Your Company has made timely payment of interest and principal amount on the respective due dates for NCDs issued
by the Company and there has been no default in payment. The necessary disclosures as per SEBI Master Circular no.
SEBI/HO/DDHS/PoD1/P/CIR/2024/54 dated May 22, 2024 has been disclosed to BSE Limited and are available at the
website of the Company. Further, during the year under review, the Company has not issued any Non-Convertible
Debentures.

Pursuant to NBFC-HFCs (RBI) Master Directions, 2021, the following statement is provided -

Total No. of NCDs which have not been claimed by the Investors or paid by the Company after the date on which NCDs became due for redemption.	NIL
Total Amount in respect of NCDs remaining unclaimed / unpaid beyond due date	NIL

REVIEW OF OPERATIONS

Your Company is registered as a Non-deposit taking Housing Finance Company (HFC) with RBI to carry out the housing
finance activities in India.

In accordance with the Master Direction - Non-Banking Financial Company - Housing Finance Company (Reserve Bank)
Directions, 2021, Housing Finance Company shall mean a Company incorporated under the Companies Act, 2013 that
fulfils the following Principal Business Criteria (PBC):

a) It is an NBFC whose financial assets, in the business of providing finance for housing, constitute at least 60% of its
total assets (netted off by intangible assets).

b) Out of the total assets (netted off by intangible assets), not less than 50% should be by way of housing financing for
individuals.

During the year, the Company has met the aforesaid principal business criteria for HFCs.

To build a quality loan book, your Company endeavors to adopt superior underwriting practices backed by robust
monitoring and recovery mechanism. Your Company is committed towards improving efficiency in all its processes and
service levels for its customers.

Your Company''s thrust continues to be the affordable housing segment, with its focus on catering to the aspirations of
low and middle-income Indian families who dream to own their homes. Your Company has been facilitating credit
access to the low and middle-income self-employed customers in semi-urban and rural areas in India. The majority of
your Company''s customers have limited access to formal banking credit facilities.

During the Financial Year under review, your Company delivered a resilient performance, which is reflected in the
following financial snapshot:

» Income & Profits

Total Revenue from operations increased by 54.07% to Rs. 9,49 6.27 Lakhs for the Financial Year ended March 31, 2025
as compared to Rs. 6,163.55 Lakhs for the previous Financial Year. Profit before Tax (PBT) was 23.68 % higher at Rs.
1,418.80 Lakhs as compared to Rs. 1,147.12 Lakhs for the previous Financial Year. The Total Comprehensive Income for
the Financial Year 2024-25 increased by 21.88% at Rs. 1,071.78 Lakhs in the Financial Year as compared to Rs. 879.39
Lakhs in the Previous Financial Year.

» Sanctions

During the Financial Year under review, your Company sanctioned housing loans of Rs. 18,246.88 Lakhs as compared to
Rs. 23,796.11 Lakhs sanctioned in the previous Financial Year. The cumulative loan sanctions since inception of your
Company stood at Rs. 81,571.83 Lakhs as at March 31, 2025.

» Disbursements

During the Financial Year under review, your Company disbursed loans of Rs. 14,951.44 Lakhs (including off balance
sheet disbursement of Rs. 1039.90 lacs) as compared to Rs 24,072.63 Lakhs (including off balance sheet disbursement
of Rs. 3,592.33 Lakhs) disbursed in the previous Financial Year.

» Capital Adequacy

The Company has been maintaining the Capital Adequacy Ratio (CAR) above the minimum required level of 15% as
prescribed by Reserve Bank of India (RBI).

The Capital Adequacy Ratio of the Company as at March 31, 2025 is 50.55 % as against 54.65 % as at March 31, 2024.

» Assets Under Management (AUM)

The AUM of your company stood at Rs. 52,069.78 Lakhs (including off balance sheet AUM of Rs. 10,275.24 Lakhs) as at
March 31, 2025 as against Rs. 42,686.39 Lakhs (including off balance sheet AUM of Rs. 4,396.10 Lakhs) in the previous
financial year, registering a growth of 21.98%

Prudential Norms for the HFCs Issued By RBI

Star Housing Finance Limited ("the Company") is registered with the National Housing Bank (NHB) as a Non-Deposit
Accepting Housing Finance Company (HFC). Pursuant to the Reserve Bank of India''s (RBI) Scale Based Regulation (SBR)
framework notified on October 22, 2021, all HFCs are classified under the Middle Layer for regulatory purposes. This
revised framework, which became effective from October 1, 2023, covers key areas such as capital adequacy,
governance, and prudential norms.

The Company has taken necessary steps to ensure full compliance with the SBR guidelines applicable to NBFC-Middle
Layer (NBFC-ML) entities.

Further, in line with RBI Circular No. D0R.FIN.HFC.CC.No.120/03.10.136/2020-21 dated February 17, 2021 (updated as on
February 27, 2025), the Company complies with the Master Direction - Non-Banking Financial Company - Housing
Finance Company (Reserve Bank) Directions, 2021 and all other applicable regulations issued by the RBI and NHB.

Further, the Company''s Non-Convertible Debentures (NCDs) issued on a private placement basis are listed on the
Wholesale Debt Market (WDM) Segment of BSE Limited, and the Company is in compliance with the provisions of the
SEBI (Issue and Listing of Non-Convertible Securities) Regulations, 2021 and the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015.

Asset Classification and Provisioning Norms:

The RBI has come out with certain clarifications on Income Recognition, Asset Classifications and Provisioning norms
with a view to have a uniformity across all the lending institutions including HFCs vide their notification dated November,
12 2021. As per the notification, all the NBFCs have to specify the exact due dates of loan repayment along with the
methodology of SMA/NPA classifications reckoning from the due dates, in their loan agreements. Upgradation of
accounts classified as NPA to STANDARD may be done only if entire arrears of interest and principal are paid by the
borrower. Further, the companies would also provide consumer education literature on their websites explaining with
examples, the concepts of overdue SMA and NPA classification and upgradation of accounts. The company has been
complying with these instructions meticulously.

PROSPECTS AND DEVELOPMENTS:

There is a very huge market to be served, which needs an efficient last mile delivery of credit, thus creating enormous
opportunity for all the financial institutions and HFCs in special. The Company continues to pursue the strategy of being
multi-product and multi-location, thus giving the distinct edge from the risk management and scalability perspective.
The focus across the product is of catering to the lower and the middle income segment, which are the key drivers of
our economy.

HOUSING FINANCE:

The Company aims at serving the middle income and the lower income sector of the economy, especially in the semi
urban and rural areas, which are reckoned to be the key drivers of the sector in the coming decades. Full-fledged efforts
are on to execute efficiently, as per the detail planning. Being aware of the challenges involved in serving this class of
the society, a very cautious approach is adopted in building up volumes. Nevertheless, Company is quite confident of
building substantial volumes in the near future. The Company''s rural initiative will also start yielding results shortly. It
is worth mentioning that despite the creditworthy customer class, ascertaining the title of the property remains a
challenging job. The Company is actively involved with all the stakeholders to smoothen the process and is assertive in
getting the right set of documents. We continue to endeavor relentlessly and are confident of creating a quality
portfolio and add value to the ecosystem of country''s housing finance.

DISTRIBUTION NETWORK:

Your company has been successful in continuous expansion of its branch network with a view to support its sustainable
growth, deeper penetration in the states in which the Company operates and enhancing customer reach. During the
Financial Year under review, the Company has expanded its branch network to 6 states with 35 branches as on March
31, 2025. Your Company operates in Akola, Baramati, Chennai, Hingoli, Indore, Jaipur, Jalgoan, Mahad, Nashik, Pune,
Udaipur, Rajsamand, Surat, Dewas, Ahmednagar, Vapi, Vyara, Pithampur, Khargone, Dhar, Chalisgaon, Kalyan, Kolhapur,
Washim, Panvel, Virar, Buldhana, Hapur, Meerut, Ghaziabad, Dudu, Mathura, Kanchipuram, Sholinghur, Vellore.

HUMAN RESOURCE MANAGEMENT:

During the year, the HR continued to provide timely on-board experienced resources across all locations, imparting
functional and system training to develop productive resources for all the functional teams. The Company also gives an
opportunity to identify and develop the internal talent pool. The Company hired professionals at senior positions as
Functional Heads for heading the various Departments of the Company, having relevant industry experience and
expertise to strengthen and grow the housing finance business of the Company.

The Company''s success depends largely upon the quality and competence of its Management team and Key Personnel.
Attracting and retaining talented professionals is therefore a key element of the Company''s strategy and a significant
source of competitive advantage. The Company has a diverse workforce of 266 employees as on March 31, 2025. There
are 244 male and 42 female employees as on the financial year end.

Human resource development is considered vital for effective implementation of business plans. Constant endeavors
are being made to offer professional growth opportunities and recognition, apart from imparting training to the
employees at all levels. Your Company has also provided the sales training to the new recruits to provide them better
understanding of the Company and align them towards the working culture of the Company.

Your Company will always strive to strengthen this most important resource in its quest to have enabling human capital.

CAPITAL AND LIABILITY MANAGEMENT:

The Company in tandem with its philosophy of pursuing the mission of "Excellence through Endeavors" will strive to
maximize the shareholders'' wealth. The Company continues to pursue an efficient capital management policy, which
aims at maximizing the return on capital employed and at the same time adhering to the prudential guidelines laid down
by RBI/NHB from time to time.

The Company by virtue of its performance over the years enjoys very good relationships with many leading banks and
financial institutions. The Company could raise the required resources from various banks and financial institutions
easily. We anticipate the same response from all our lending partners for the coming years too. The Company
anticipates credit lines from few more banks and financial institutions besides the existing ones.

During the year, when the whole sector was looked upon as a risky proposition, the Company could not only manage to
raise the required resources but also obtained credit lines for the coming year.

Your Company continues to command the respect and the confidence of Bankers as their extended channel in their task
of providing efficient delivery of credit. The company acknowledges the constructive support of the Investors and
Banks.

RESOURCE MOBILISATION:

Your Company''s borrowing policy is under the control of the Board. The Company has vide special resolution passed on
10th August, 2023, under Section 180 (1) (a) & 180(1)(c) of the Companies Act, 2013, authorized the Board of Directors to
borrow money upon such terms and conditions as the Board may think fit in excess of aggregate of paid up share
capital, free reserves, security premium of the Company up to an amount of Rs. 700 crores and the total amount so
borrowed shall be within the limits as prescribed under the regulatory directions issued from time to time. The prevalent
relevant directions issued by RBI under Master Direction - Non-Banking Financial Company - Housing Finance Company
(Reserve Bank) Directions, 2021 as amended are being complied with.

Your Company continued to use a variety of funding sources to optimize funding costs, protect interest margins and
maintain a diverse funding portfolio which further strengthened its funding stability and liquidity needs. Your Company
continued to keep tight control over the cost of borrowings through negotiations with lenders and thus, raised resources
at competitive rates from its lenders while ensuring proper asset liability match.

Your Company continued to diversify its funding sources by exploring the Capital Market through private placement to
Financial Institution, Banks, NHB Refinance, NHB SRF (Special Refinance Facility Assistance), NHB''s LIFT (Liquidity
Infusion Scheme).

DIRECT ASSIGNMENT AND CO-LENDING:

In line with our strategic objective to accelerate AUM growth and deepen our presence in underserved markets,the
Company has entered into a Direct Assignment (DA) transaction to the tune of Rs. 6203.83 Lakhs and a co-lending
partnership with Vastu Housing Finance Corporation Limited (Vastu HFC), during the year under review. Under the DA
model, the Company will efficiently deploy capital to Vastu HFC, enabling us to expand our geographic reach and
optimize our balance-sheet utilization, while Vastu HFC strengthens its retail housing portfolio.

Through the co-lending framework, the Company will originate, underwrite and service affordable home loans - targeting
over 5,000 first-time buyers in the EWS/LIG segments across semi-urban and rural regions - leveraging Vastu HFC''s
capital support, technology platform and risk-sharing mechanisms. This collaboration not only reinforces our
commitment to financial inclusion and first-time home ownership, but also provides both organizations with mutual
access to best-in-class processes, enhanced credit flow and scalable growth in priority markets.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

The Company, being a HFC registered with the NHB and engaged in the business of providing loans in ordinary course
of its business, is exempt from complying with the provisions of Section 186 of the Companies Act, 2013, with respect
to loans. However, details of the loans made, guarantee given or security provided by the Company other than in the
ordinary course of business are given in the Notes to accounts forming part of the Audited Financial Statements for the
year ended March 31, 2025.

ALTERATION IN MEMORANDUM AND ARTICLES OF ASSOCIATION:

During the year under review, the Company has not made any alteration in Memorandum and Article of Association of
the Company. The Copy of the aforesaid documents are available on the Company''s website at https://www.starh-
fl.com/wp-content/uploads/2025/04/1.-MOA-and-AOA.pdf

NON-PERFORMING ASSETS AND PROVISIONS FOR CONTINGENCY:

The Gross NPA of your Company as on March 31, 2025 was Rs. 769.14 Lakhs; 1.84% (previous year Rs. 572.56 Lakhs;
1.50 %). The Net NPA as on March 31, 2025 was Rs. 580.65 Lakhs; 1.40% (previous year 388.90 Lakhs; 1.02%). The
regulatory and compliance reporting, has been done in accordance with the prudential guidelines for Non-Performing
Assets (NPAs) issued by the Reserve Bank of India under Master Direction - Non Banking Financial Company - Housing
Finance Company (Reserve Bank) Directions, 2021.

A detailed comparison of asset classification as per the Ind AS provisions and IRACP norms has been provided under
Disclosures required by Reserve Bank of India/National Housing Bank forming part of the Audited Financial Statements.

Your Company has made adequate provision for the assets on which installments are overdue for more than 90 days
and on other assets, as required. For details on the impairment provisioning, please refer to disclosures required by
RBI/NHB to the financial statements. By way of prudence and abundant caution, Company has provided additional
provision over and above the RBI guidelines as on March 31, 2025.

The Company has maintained cumulative NPA provision of Rs. 188.49 lakhs against the required provision of
Rs. 187.91 lakhs. Further for standard assets Company carries provision of Rs. 198.10 lakhs.

DETAILS RELATING TO DEPOSITS:

The Company has been granted registration by the Reserve Bank of India as a non-deposit taking Housing Finance
Company and hence the provisions relating to Chapter V of the Act, i.e., acceptance of deposit, are not applicable to the
Company.

BSE COMPLIANCES:

The Company has submitted compliances as required quarterly/half yearly/ yearly in accordance with the prescribed
guidelines.

Further, the annual listing fees, as prescribed, have been paid to BSE Limited within the due time.

INVESTOR COMPLAINTS AND COMPLIANCE:

The Company has not received any investor complaints during the year and the report of the same was submitted to
BSE pursuant to SEBI (LODR) Regulations, 2015.

ONLINE DISPUTE RESOLUTION (ODR) MECHANISM:

In order to streamline the dispute resolution mechanism in the securities market, SEBI vide its circular dated 31 July 2023,
as amended from time to time, read with Master Circular no. SEBI/HO/OIAE/OIAEJAD3/P/CIR/2023/195 dated 28
December 2023, introduced a common Online Dispute Resolution (“ODR”) mechanism which harnesses online
conciliation and arbitration for resolution of all kinds of disputes relating to securities market.

Under ODR mechanism, an investor shall first take up his/her/their grievance by lodging a complaint directly with the
concerned Market Participant viz., Company. If the grievance is not redressed satisfactorily at the first phase, the investor
may escalate the same through the SCORES Portal in accordance with the process laid out therein. ODR Mechanism
provides a third level of escalation, if the investor is not satisfied with the resolution provided by the Company, the
investor may initiate the dispute through the ODR portal within the timeframe prescribed under the circular. The ODR
portal can be accessed at https://smartodr.in/login.

TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND:

In accordance with the provisions of Sections 124, 125 and other applicable provisions, if any, of the Act, read with the
Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (hereinafter
referred to as ‘IEPF Rules'') (including any statutory modification(s) or re-enactment(s) thereof for the time being in
force), the amount of dividend remaining unclaimed or unpaid for a period of 7 (Seven) years from the date of transfer
to the Unpaid Dividend Account is required to be transferred to the Investor Education and Protection Fund (IEPF)
maintained by the Central Government. Further as per the provisions of Section 124(6) of the Act read with IEPF Rules,
the shares in respect of which dividend has not been paid or claimed by the Shareholders for 7 (Seven) consecutive years
or more are also required to be transferred to the designated demat account created by the IEPF Authority.

Your Company does not have any funds lying unpaid or unclaimed for a period of seven years. Therefore, there are no
funds which were required to be transferred to IEPF till the date of this Report.

MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE
COMPANY FROM THE END OF FINANCIAL YEAR TILL THE DATE OF REPORT:

There have been no material changes and commitments affecting the financial position of the Company which have
occurred between the end of the Financial Year of the Company to which the financial statements relate till the date of
this report.

EVENTS AFTER THE END OF FINANCIAL YEAR:

Listing of Equity Shares on the National Stock Exchange of India Limited (NSE)

The Company has made an application for the direct listing of its equity shares on the National Stock Exchange of India
Limited (NSE) on July 16, 2025, with a view to enhance liquidity, broaden investor participation, and increase visibility in
the capital markets. The listing, upon approval, is expected to provide an additional platform for trading of the
Company''s shares and further strengthen corporate governance and transparency standards.

Further, in respect thereof, the Company has made adequate and timely disclosures to the Stock Exchange, in
compliance with the applicable regulatory requirements.

Reclassification of Promoter Shareholding

The Company has received a request from the Promoters and Promoter Group of the Company for reclassification of
their shareholding from the “Promoter and Promoter Group” category to the “Public” category in accordance with
Regulation 31A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The said request is being processed in compliance with the applicable provisions of SEBI LODR Regulations and is
subject to necessary approvals from the Stock Exchange, members of the Company and other regulatory authorities, as
may be required.

PROVISION OF FINANCIAL ASSISTANCE TO THE EMPLOYEES OF THE COMPANY FOR
THE PURCHASE OF ITS OWN SHARES:

The company has not provided any financial assistance to its employees as per Section 67 of the Companies Act, 2013
(the ‘Act”) for the purchase of its own shares.

SUBSIDIARY, JOINT VENTURES AND ASSOCIATE COMPANIES:

As on March 31, 2025, the Company does not have any subsidiaries, associates, or joint ventures. Accordingly, the
requirement of attaching Form AOC-1 is not applicable to the Company.

PARTICULARS OF EMPLOYEES:

In terms of Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014, the disclosures with respect to the ratio of remuneration of director to median
remuneration of employees, percentage increase in the median remuneration of the Company have been provided in
Annexure VIII annexed to this Report.

Further, statement containing details top ten (10) employees in terms of the remuneration and employees in receipt of
remuneration as required under Rule 5(2) and Rule 5(3) of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014, is available for inspection at the Registered Office of the Company during working
hours for a period of 21 days before the date of the ensuing Annual General Meeting. A copy of the statement may be
obtained by shareholders by writing to the Secretarial Department at the Registered & Corporate Office of the Company
or at [email protected].

PARTICULARS OF CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, AND
FOREIGN EXCHANGE EARNING AND OUTGO:

In accordance with the provision of sec 134(3) (m) of the Act, read with Rule 8 of the Companies (Accounts) Rules 2014
the requisite information relating to your Company are as under:

A. Conservation of energy:

The Company does not fall under any of the industries covered by the Companies (Disclosure of particulars of Directors)
Rules, 1988.

B. Technology absorption:

Your company has successfully deployed a next generation, core housing virtual solution to stay at the forefront of
technological innovation, enhance operational efficiency, and accelerate end to end loan processing. By integrating all
branch offices with the head office on a secure, cloud based LOS LMS platform, you have partnered with Jaguar
Software India to customize the system to your specific regional requirements. This strategic collaboration delivers the
following key benefits:

» Document Digitization: All customer and loan documents are captured electronically, eliminating paper based
workflows.

» Centralized Operations: Real time connectivity across all branches and the corporate office ensures consistent data
access and streamlined communication.

» Accelerated Loan Processing: Automated workflows and predefined approval hierarchies reduce turnaround times
significantly.

» On Demand Reporting: Single click generation of comprehensive reports enhances transparency and decision
making.

» Robust Collaboration: An inter departmental solution fosters seamless coordination between sales, credit,
underwriting, and operations teams.

» Mobile Field Enablement: Android and iOS applications empower field staff to submit initial documents and
verification remarks immediately from customer premises.

» Cost and Risk Reduction: Savings in logistics, handling, and printing, coupled with minimized physical document
movement, lower operational costs and mitigate security risks.

» Enhanced Credit Analysis: Automated data capture and structured workflows improve the consistency and quality
of credit assessments.

» Enterprise Grade Security: A cloud-based platform with end-to-end encryption and role based access control
safeguards sensitive loan information.

» Maker Checker Controls: Clearly defined maker checker roles ensure that only authorized personnel can grant final
approval.

» Comprehensive Audit Trails: Digital logs preserve the complete history of each loan transaction, facilitating audits
and traceability.

» Simplified Workflows and MIS: Regular management information system (MIS) updates provide actionable
insights and reinforce process discipline.

Jaguar Software India, as your dedicated service provider, will deliver ongoing platform upgrades and implement the
latest security protocols as required, ensuring that your solution remains both cutting edge and secure.

The RBI vide its Master Direction - Information Technology Framework for the NBFC Sector dated November 7, 2023,
which shall apply mutatis mutandis to all HFCs also, had notified Information technology framework (guidelines) for all
NBFCs including Housing Finance companies (''HFCs'') to enhance safety, security, efficiency in process leading to benefit
for HFCs and their customer.

Your company is in compliance with the aforesaid guidelines.

Your company does not have any foreign exchange earnings and outgo during the year under review.

RISK MANAGEMENT FRAMEWORK:

With the challenging macroeconomic conditions and uncertainties, there are heightened risks faced by the Company
which can be inherent or market-related risks. There has been a continuous focus on identifying, measuring and
mitigating risks by the Company. As a housing finance company, the Company is exposed to various risks like credit risk,
market risk (interest rate and currency risk), liquidity risk and operational risk (technology, employee, transaction and
reputation risk). A key risk in the competitive home loans, and mortgage-backed funding in general is losing customers
that transfer out their loans for small gains in interest rates, this represents a significant loss of opportunity to the
Company given the long-term nature of mortgage loans. To identify and mitigate all these risks, the Company has an
effective Risk Management Control Framework that has been developed compassing all the above areas.

The Company has a Risk Management Committee (RMC). The RMC has met Five times during the year and kept an
active watch on the emergent risks the Company come across during the course of business. The Risk Management
Committee oversees the process of identification, measurement and mitigation of risks.

During the Financial Year under review, the Risk Management Committee reviewed the risks associated with the
business of your Company, undertook its root cause analysis and monitored the efficacy of the measures taken to
mitigate the same. In addition, the Committee reviewed and approved various policies aimed at strengthening the
Company''s risk management framework and ensuring alignment with regulatory and strategic objectives.

The Board of Directors in its meeting held on June 18, 2024 has appointed Mr. Ajit Kumar Satpathy as Chief Risk Officer
of the Company for a tenure of 3 years w.e.f. July 1, 2024 to function independently and ensure highest standards of risk
management.

The Company has a Risk Management Policy in place and the same can be accessed on the website of the Company at
https://www.starhfl.com/wp-content/uploads/2023/12/1.-Risk-Management-Policy.pdf

ASSET LIABILITY MANAGEMENT COMMITTEE (ALCO):

Pursuant to the RBI Guidelines, the Company has in place a Committee of Directors for Asset Liability Management
(''ALM''). It consist of the following persons as its members:

Mr. Kalpesh Dave -Chairman
Mr. Natesh Narayanan-Member¹

Mr. B.S. Kachhawaha- Member¹

Mr. Ajit Kumar Satpathy -Member
Mr. Anoop Saxena-Member

The ALCO lays down policies and quantitative limits that involve assessment of various types of risks and shifts in assets
and liabilities to manage such risks. ALCO ensures that the liquidity and interest Rate risks are contained within the
limits laid down by the Board.

The minutes of the Committee meetings were placed before the Board for their noting and review.

VIGIL MECHANISM/WHISTLE BLOWER POLICY:

Pursuant to the provisions of Section 177 (9) & (10) of the Companies Act, 2013 read with Rule 7 of Companies (Meetings
of Board and its Powers) Rules, 2014 and Regulation 22 of the Securities and Exchange Board of India (Listing Obliga¬
tions and Disclosure Requirements) Regulations, 2015 and Regulation 9A of SEBI (Prohibition of Insider Trading) Regu¬
lations, 2015, the Company has in place a Whistle Blower Policy in place, which provides for a framework to report the
genuine concerns against the suspected or confirmed fraudulent activities, allegations of corruption, violation of the
Company''s Code of Conduct and leak or suspected leak of unpublished price sensitive information.

The Company will provide adequate safeguards against victimization of persons who use this mechanism. Such persons
shall have direct access to the Chairman of the Audit Committee when appropriate.

The whistle blower policy is placed on the website of the Company and can be accessed at https://www.starh-
fl.com/wp-content/uploads/2073/06/Vigil-Mechanism-Whistle-Blower-Policy.pdf

During FY 2025, no person was denied access to the Audit Committee or its chairperson under this policy.

CODES AND STANDARDS

Your Company has formulated various policies and codes in compliance with provisions of Directions and Guidelines
issued by the Reserve Bank of India, Companies Act, 2013, Securities and Exchange Board of India (Listing Obligations
and Disclosure Requirements) Regulations, 2015 and to ensure high ethical standards in the overall functioning of the
organization. The said policies and codes are periodically reviewed by the Board of Directors. The key policies and codes
as approved by the Board of Directors and the respective compliance thereunder are detailed herein below:

a) Know Your Customer & Anti Money Laundering Measure Policy

Your Company has approved Know Your Customer & Anti Money Laundering Measure Policy (KYC & AML Policy) in
place and adheres to the said Policy. The said Policy is in line with the Reserve Bank of India, Master Directions - 2016
on KYC and AML applicable to all regulated entities. The Company has also adhered to the compliance requirement in
terms of the said policy relating to the monitoring and reporting of cash / suspicious transactions. The Company furnishes
to Financial Intelligence Unit (FIU), India, in the electronic medium, information of all cash transactions of the value of
more than Rupees Ten Lakh or its equivalent in foreign currency and suspicious transactions whether or not made in
cash, in terms of the said Policy. The policy is placed on the website of the Company and can be accessed at
https://www.starhfl.com/wp-content/uploads/7073/17/Policy-on-KYC-and-AMI-Standards-Final-7-.pdf

b) Fair Practice Code

Your Company has in place a Fair Practice Code (FPC), which includes guidelines on appropriate staff conduct when
dealing with the customers and on the organization''s policies vis-a-vis client protection. The FPC captures the spirit of
the Reserve Bank of India guidelines on fair practices for Housing Finance Companies. During the year under review,
FPC was modified by the Board and the grievance redressal mechanism within the Company was further strengthened.
The policy is placed on the website of the Company and can be accessed at https://www.starhfl.com/wp-content/up-
loads/7073/17/Fair-practice-Code.pdf

c) Policy on Disclosure of material events and information

The Company has in place the Policy on Disclosure of Material Events and Information, in accordance with Securities and
Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 to determine the events
and information which are material in nature and are required to be disclosed to the Stock Exchanges. The policy is
placed on the website of the Company and can be accessed at https://www.starhfl.com/wp-content/uploads/2024/08/-
Disclosure-of-policy-for-determination-of-materiality-of-events-or-information.pdf

d) Code of Conduct for Board Members and the senior management

The Company has adopted Code of Conduct for the Board of Directors and the Senior Management Personnel to set
forth the guiding principles on which the Company and its Board and Senior Management Personnel shall operate and
conduct themselves with multitudinous stakeholders, government and regulatory agencies, media and anyone else with
whom it is connected. The policy is placed on the website of the Company and can be accessed at https://www.starh-
fl.com/wp-content/uploads/2023/02/Code-of-conduct-of-Board-of-Directors-and-Senior-Management-Personnel.pdf

e) CEO & CFO Certification

The Chief Executive Officer(CEO) and Chief Financial Officer (CFO) have certified to the Board in accordance with Regu¬
lation 17(8) read with Part B of Schedule II of the Listing Regulations pertaining to CEO/CFO certification for the financial
year ended March 31, 2025, which is annexed hereto as Annexure VII

f) Code for Prevention of Insider Trading Practices

The Company has formulated and adopted a Code for Prevention of Insider Trading Practices in accordance with the
model code of conduct as prescribed under the Securities and Exchange Board of India (Prohibition of Insider Trading)
(Amendment) Regulations, 2018, as amended. The code lays down guidelines, which includes procedures to be followed
and disclosures to be made while dealing in the shares of the Company. The code is applicable to the promoters,
directors, senior designated employees and their dependents and the said persons are restricted from dealing in the
securities of the Company during the ''restricted trading periods'' notified by the Company, from time to time.

g) Code of Business Ethics (COBE)

The Company has adopted a Code of Business Ethics (COBE) which lays down the principles and standards that govern
the activities of the Company and its employees to ensure and promote ethical behavior within the legal framework of
the organization.

The Company is committed to provide a healthy environment to all the employees and thus does not tolerate any sexual
harassment at workplace. The Company has a Policy on Prevention, Prohibition & Redressal of Sexual Harassment of
Women at Workplace and an Internal Complaints Committee (ICC) has been constituted there under. The Policy''s
primary objective is to protect the women employees from sexual harassment at the place of work and also provides for
punishment in case of false and malicious representations. All employees are covered under the policy. No complaints
were received from any employee during the Financial Year 2024-25, and therefore, no complaints were outstanding for
redressal as of March 31, 2025.

The policy is placed on the website of the Company and can be accessed at https://www.starhfl.com/wp-content/up-
loads/2023/03/Star Anti-Sexual-Harrasment-Policy 1.0.pdf

h) Comprehensive Risk Management Policy

The Company is committed to manage its risk in a proactive manner and has adopted a structured and disciplined
approach to risk management by developing and implementing risk management framework. With a view to manage
its risk effectively your Company has in place a Comprehensive Risk Management Policy which covers a formalized Risk
Management Structure, along with other aspects of risk management i.e. credit risk management, operational risk
management, market risk management and enterprise risk management. The Risk Management Committee of the
Board, on periodic basis, oversees the risk management systems, processes and minimization procedures of the Company.

i) Corporate Social Responsibility (CSR) Policy

The Company has Corporate Social Responsibility Policy (CSR Policy), as per the provisions of the Companies (Corporate
Social Responsibility Policy) Rules, 2014, as amended, which, inter-alia, lays down the guidelines and mechanism for
undertaking socially useful projects for welfare and sustainable development of the community at large. As per the
provisions of Section 135 of the Companies Act, 2013, the Company has constituted a Corporate Social Responsibility
Committee. The Committee assists the Board in fulfilling its duty towards the community and society at large by
identifying the activities and programmers that can be undertaken by the Company, in terms of the Company''s CSR
Policy. The composition of the CSR Committee and its terms of reference are given in the Corporate Governance Report
forming part of this Annual Report.

The brief outline on CSR activities is mentioned in Notes to Financial Statements forming part of the Annual Report.
The policy is available on the Company''s website https://www.starhfl.com/wp-content/uploads/2024/09/CSR-Policy SHFI.pdf

j) Remuneration Policy

The Nomination and Remuneration Committee had laid down criteria for determining Director''s Qualification,
Attributes and Independence of a Director, remuneration of Directors, Key Managerial Personnel and other employees
and criteria for evaluation of Directors, Chairperson, Non-Executive Directors and Board and the evaluation process of
the same. In this respect the Company framed the Remuneration Policy in order to align with various provisions under
SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and RBI Circular DOR.GOV.REC.No.
29/18.10.002/2022-23 dated 29th April, 2022. The policy may be accessed on the Company''s website at https://www.star-
hfl.com/wp-content/uploads/2023/06/Remuneration-Policy.pdf

k) Related Party Transactions Policy

The Company has a Related Party Transaction Policy, intended to ensure requisite approval, reporting and disclosure of
transactions between the Company and its related parties. The said policy also defines the materiality of related party
transactions and lays down the procedures of dealing with related party transactions. During the year under review, the
Related Party Transaction Policy was amended to align the same with the requirements of Companies (Amendment)
Act, 2015 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations,
2015. The policy is placed on the website of the Company and can be accessed at https://www.starhfl.com/wp-con-
tent/uploads/2023/02/2.-RPT-Policy SHFI.pdf

l) Familiarisation Programme for Independent Directors

The objective of a familiarisation programme is to ensure that the non-executive directors are updated on the business
environment and overall operations of the Company. This enables the non-executive directors to make better informed
decisions in the interest of the Company and its stakeholders. The policy is placed on the website of the Company and
can be accessed at https://www.starhfl.com/disclosure-under-regulation-46-of-sebi-lodr-2015/

DIRECTORS AND KEY MANAGERIAL PERSONNEL

The Board of Directors of the Company comprises of Seven [7] Directors of which one [1] is Executive Director; One [1]
is Whole-time Director & Chief Executive Officer & Five [5] are Non - Executive Independent Directors including one
woman Director as on March 31, 2025 who brings in a wide range of skills and experience to the Board.

» Retirement of Director by rotation

In accordance with the provisions of Section 152(6) of the Companies Act, 2013 and Articles of Association of the Company,
Mr. Kalpesh Dave, Executive Director & CEO of the Company, who is liable to retire by rotation, has offered himself for
re-appointment at the ensuing twentieth Annual General Meeting of the Company. A resolution for his re-appointment
is being proposed at the twentieth Annual General Meeting and his profile is included in the AGM notice.

» Composition of the Board as on March 31, 2025

DIN	NAME OF DIRECTORS	CATEGORY OF DIRECTORS
08221964	Mr. Kalpesh Dave	Executive Director & Chief Executive Officer
02041197	Mr. Kavish Jain	Executive Director
06964564	Mr. Amlendra Prasad Saxena	Non-Executive & Independent Director
09724549	Mr. Ajith Kumar Lakshmanan	Non-Executive & Independent Director
07653773	Mrs. Neelam Tater	Non-Executive & Independent Director
06593113	Mr. Pradip Kumar Das	Non-Executive & Independent Director
03498879	Mr. Chinnathambi Ilango	Non-Executive & Independent Director

Based on the confirmations received, none of the Directors are disqualified from being appointed/re-appointed as a
director in terms of Section 164 the Companies Act, 2013, a Certificate from M/s. D. M. Zaveri & Co. Practicing Company
Secretaries regarding the Non-disqualification of Directors from being appointed/continue for the office of Director in your
Company is placed as Annexure VI.

» Composition of the Key Managerial Personnel (KMP) as on March 31, 2025

SR. NO.	NAME OF DIRECTORS	CATEGORY OF DIRECTORS
1	Mr. Kalpesh Dave	Chief Executive Officer
2	Mr. Natesh Narayanan	Chief Financial Officer
3	Mr. Anoop Saxena	Chief Operating Officer
4	Mr. Shreyas Mehta	Company Secretary & Compliance Officer
5	Mr. B.S. Kachhawaha	Chief Compliance Officer
6	Mr. Ajit Kumar Sathpathy	Chief Risk Officer
7	Mr. Sandeep Kadam	Chief Business Head

» During the year following changes took place in the Board of Directors / KMP / Senior Managerial Personnel
of Company:

SR. NO.	NAME OF DIRECTORS/ KMP	DESIGNATION	APPOINTMENT/ RESIGNATION	DATE OF CHANGE
1	Mr. Ashish Jain	Chairman and Managing Director	Resignation	28.06.2024
2	Mr. Kalpesh Dave	Additional Director & CEO	Appointment	18.06.2024
3	Mr. Kalpesh Dave	Executive Director & CEO	Change in Designation	18.06.2024
4	Mr. Ajit Kumar Satpathy	Chief Risk Officer	Appointment	01.07.2024

» Following changes took place after the end of Financial Year End till the date of the report:

SR. NO.	NAME OFKMPS	DESIGNATION	APPOINTMENT/ RESIGNATION	DATE OF CHANGE
1	Mr. Bhanwar Singh Kachhawaha	Chief Compliance Officer	Resignation	14.05.2025
2	Mr. Natesh Narayanan	Chief Financial Officer	Resignation	15.06.2025

» Declaration from Independent Directors on Annual Basis:

The Company has received necessary declarations and disclosures from the Independent Directors under Section 149(7)
and Section 184(1) of the Companies Act, 2013 stating that they meet the criteria of independence as laid down in Section
149(6) of the Companies Act, 2013 and under Regulation 16 of the SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 (“the Listing Regulations”) and disclosing their interest in form MBP-1.

Further, all Independent Directors of the Company have submitted declarations confirming that:

i. The disqualifications mentioned under sections 164, 167 and 169 of the Companies Act, 2013 do not apply to them.

ii. They have complied with the Code for Independent Directors prescribed in Schedule IV to the Act as applicable.

iii. They have registered themselves with Independent Directors'' Database of The Indian Institute of Corporate Affairs
(‘IICA'') and have cleared the online proficiency test of IICA, as applicable.

iv. They are not aware of any circumstances or situations, which exist or may be reasonably anticipated, that could impair
or impact their ability to discharge their duties with an objective independent judgment and without any external
influence; and

The Board of the Company has taken the disclosures and declarations on record after verifying the due veracity of the
same. In the opinion of the Board, all the Independent Directors possess the integrity, expertise and experience including
the proficiency required to be Independent Directors of the Company, fulfill the conditions of independence as specified in
the Act and the SEBI Listing Regulations and are independent of the management and have also complied with the Code
for Independent Directors as prescribed in Schedule IV of the Act. The Directors and the senior management personnel
have affirmed compliance with the Code of Conduct for Directors and Senior Management Personnel.

FORMAL EVALUATION OF THE PERFORMANCE OF THE BOARD COMMITTEE OF THE
BOARD AND INDIVIDUAL DIRECTOR:

Pursuant to the provisions of the Companies Act, 2013 and Regulation 17 and Part D of Schedule II to the Listing
Regulations, the Board has carried out the annual performance evaluation of its own performance, the Directors
individually as well as working of its Audit, Nomination and Remuneration, Stakeholders'' Relationship and Corporate
Social Responsibility Committees. A structured questionnaire was prepared after taking into consideration inputs
received from the Directors, covering various aspects of the Board''s functioning such as adequacy of the composition of
the Board and its Committees, Board culture, execution and performance of specified duties, obligations and
governance.

The exercise was carried out to evaluate the performance of individual Directors, who were evaluated on parameters
such as level of engagement and contribution, independence of judgement, safeguarding the interest of the Company, etc.

MEETING OF INDEPENDENT DIRECTORS

Pursuant to Section 149(8) read with Schedule IV of the Act, and Regulation 25(3) of SEBI Listing Regulations, the
Independent Directors shall hold at least two meeting in a financial year without the presence of Non- Independent
Directors and members of the management. Accordingly, the Independent Directors of the Company met on February
14, 2025 and March 24, 2025 without the presence of Non-Independent Directors and members of the management to:

1. Review the performance of Non Independent Directors and the Board of Directors as a whole;

2. Review the performance of the Chairman and Managing Director of the Company and

3. Assess the quality, quantity and timeliness of flow of information between the management and the Board of Directors.

The performance evaluation of the Independent Directors was carried out by the entire Board. The details of the
Independent Directors Meeting and the attendance of the Directors are provided in the Corporate Governance Report,
which forms part of this Report.

NUMBER OF THE MEETINGS OF THE BOARD

The Board met Seven (7) times during the year under review. The details of the number of meetings of the Board held
during the Financial Year 2024-25 and the attendance therein forms part of the Report on Corporate Governance which
forms part of the Annual Report.

The gap between any two consecutive meetings was less than one hundred and twenty days.

COMMITTEES OF THE BOARD

The Board of Directors has the following Committees:

a) Audit Committee

b) Nomination and Remuneration Committee

c) Stakeholders'' Relationship Committee

d) Corporate Social Responsibility Committee

e) Risk Management Committee

The details of the required Committees of the Board along with their composition, number of meetings and attendance
at the meetings are provided in the Report on Corporate Governance as required under Schedule V of the Listing Regulations.

SHAREHOLDER’S MEETING

During the financial year ended March 31, 2025, 1 (one) General Meeting was held. Further, details of the meetings are
given in the Corporate Governance Report, which forms part of the Annual Report.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTY
TRANSACTIONS

In accordance with the provisions of Section 188 of the Act and rules made thereunder and considering the nature of the
industry in which the Company operates, all the transactions entered with related parties are in the ordinary course of
business and on an arm''s length basis, the details with respect to the related party transactions are mentioned in the
notes to the audited financial statements.

Pursuant to Regulation 23(4) of the SEBI Listing Regulations, 2015, all material related party transactions and
subsequent material modification as defined in the policy on materiality of related party transaction shall require prior
approval of the shareholders through resolution and no related party shall vote to approve such resolutions whether the
entity is a related party to the particular transaction or not.

Further, as per Regulation 23(1) of SEBI Listing Regulations, 2015, transaction with a related party shall be considered
material, if the transaction(s) to be entered into individually or taken together with previous transactions during a
financial year, exceeds rupees one thousand crore or ten per cent of the annual consolidated turnover of the listed entity
as per the last audited financial statements of the listed entity, whichever is lower.

Accordingly, during the financial year under review, the company has not entered into material contract, arrangement
or transaction with related party, as defined under Securities and Exchange Board of India (Listing Obligations and
Disclosure Requirements) Regulations, 2015 and Related Party Transaction Policy of the Company. The Related Party
Transactions Policy and Procedures, as amended from time to time, as reviewed by the Audit Committee and approved
by Board of Directors is uploaded on the website of the Company at https://www.starhfl.com/wp-content/up-
loads/2023/02/2.-RPT-Policy SHFI.pdf

Form AOC-2 pursuant to clause (h) of sub-section (3) of Section 134 of the Companies Act, 2013 and Rule 8(2) of the
Companies (Accounts) Rules, 2014 is annexed as “Annexure I” to this Report and forms a part of it.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The Company firmly believes that Corporate Social Responsibility (‘CSR'') is more than an obligation and more than a
duty, which helps to create positive impact on many lives. The Company persistently acts as a prudent corporate citizen
and maintains harmonious relationship with the communities in which it operates to give back to the society.

As a part of its Corporate Social Responsibility (CSR) initiative, the Company has undertaken CSR projects and programs.
These activities are in accordance with CSR activities as defined under the Act. The Company has a CSR Committee of
Directors. Details about the Committee, CSR activities and the amount spent during the year, as required under section
135 of the Act and the related Rules and other details are given in the CSR Report as Annexure IX forming part of this
Report.

PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

As per the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act,
2013, your Company has in place a Policy on Prevention Prohibition & Redressal of Sexual Harassment of Women at
Workplace and has a robust mechanism to redress the complaints reported thereunder.

Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment.
All employees (permanent, contractual, temporary, trainees) are covered under this policy.

Pursuant to the provisions of Section 22 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and
Redressal) Act, 2013, the complaints received thereunder and the details relating thereto are as follows:

Further, as per Companies (Accounts) Second Amendment Rules, 2025, the law mandates for representing the following
details:

Number of complaints of sexual harassment received in the year	NIL
Number of complaints disposed off during the year	NIL
Number of complaints pending for beyond 90 days	NIL

Your Company, on a regular basis, sensitizes its employees on prevention of sexual harassment through various
workshops, awareness programmes. It may be mentioned here that the Company has Zero tolerance towards any
action on the part of any executive / staff which may fall under the ambit of ‘Sexual Harassment'' at workplace, and is
fully committed to uphold and maintain the dignity of every women working in the Company.

SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATOR OR COURT OR TRIBUNALS
IMPACTING THE GOING CONCERN STATUS & COMPANY’S OPERATIONS IN FUTURE

During the year, there has been no such significant and material order passed by the regulators or courts or tribunals
impacting the going concern status and company''s operations in future.

CHANGE IN NATURE OF BUSINESS

There has been no change in the nature of business of the Company during the year under review.

MAINTENANCE OF COST RECORDS

The Company being a Housing Finance Company is not required to maintain cost records as prescribed under section
148(1) of the Companies Act, 2013.

SECRETARIAL STANDARDS

During the year under review, the Company has complied with the applicable secretarial standards issued by the
Institute of Company Secretaries of India.

AUDITORS AND AUDITORS’ REPORT

1. Statutory Auditors

M/s. Nyati Mundra & Co., Chartered Accountants (Firm Registration No. 008153C) were appointed as Statutory Auditors
of the Company for a period of 5 (five) consecutive years, at the Annual General Meeting of Members held on September
29, 2021 on a remuneration mutually agreed upon by the Board of Directors and the Statutory Auditors. They have
confirmed their eligibility and qualifications required under the Act for holding office as Statutory Auditors of the
Company.

The Statutory Auditor''s Report forms part of the Annual Report. There is no audit qualification, reservation or adverse
remark for the year under review. There was no instance of fraud during the year under review, which required the
Statutory Auditors to report to the Audit Committee and/ or Board under Section 143(12) of Act and Rules framed
thereunder.

The Statutory Auditors have also submitted a separate Auditor''s Report on Regulatory compliance to the Board to
comply with the requirement under chapter XII of the Master Directions. The copy of the Auditor Report is annexed
herewith.

The Notes on financial statements referred to in the Auditor''s Report are self-explanatory and do not call for any further
comments.

2. Secretarial Auditor

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and Rule 9 of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules 2014 and pursuant to Regulation 24A of Securities Exchange Board of
India (Listing Obligation & Disclosure Requirement) (Amendments) Regulations, 2018, the Board of Directors of the
Company appointed M/s D.M. Zaveri & Co., Practicing Company Secretaries, Mumbai, a Peer Reviewed Firm, to
undertake the Secretarial Audit of the Company for the financial year 2024-25. The Secretarial Audit Report & Annual
Secretarial Compliance Report for the financial year ended March 31, 2025, is annexed as "Annexure II" and
"Annexure III" forms an integral part of this Report.

Further, pursuant to the amendment of Regulation 24A of SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 with effect from 13 December 2024, the Board of Directors have approved and recommended the
appointment of M/s. D.M. Zaveri & Co., as a Secretarial Auditor of the Company for a term of 5 (Five) consecutive years
to conduct Secretarial Audit of the Company and to furnish the Secretarial Audit Report for the period commencing from
FY 2025-26 till FY 2029-2030, for approval of the Members at ensuing AGM of the Company.

Brief resume and other details are separately disclosed in the Notice of the AGM. M/s. D.M. Zaveri & Co have given their
consent to act as a Secretarial Auditor of the Company and confirmed that their aforesaid appointment, if made, would
be within the prescribed limits under the Act & Rules made thereunder and SEBI Listing Regulations. They have also
confirmed that firm is not disqualified to be appointed as a Secretarial Auditor in terms of provisions of the Act & Rules
made thereunder and SEBI Listing Regulations.

The said report, does not contain any qualification, reservation or adverse remark, and thus do not call for any further
comments.

AUDIT & INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

3. Internal auditor

Your Company has adequate internal control procedures commensurate with its size and nature of business. Your
Company has clearly laid down policies, guidelines, and procedures that form a part of the internal control systems. The
adequacy of the internal control systems encompasses the Company''s business processes and financial reporting
systems and is examined by the management as well as by its internal auditors at regular intervals.

The internal auditors conduct audits at regular intervals to identify the weaknesses and suggest improvements for
better functioning. The observations and recommendations of the internal auditors are discussed by the Audit Committee
to ensure timely and corrective action.

Your Company has appointed M/s. KVU & Associates, Chartered Accountants as an Internal Auditor of the Company,
who reports to the Audit Committee and to the Board of Directors of the Company. The Internal Auditor conducts
comprehensive audit of functional areas and operations of the Company to examine the adequacy of and compliance
with policies, procedures, statutory and regulatory requirements. Significant audit observations and follow up actions
thereon are reported to the Audit Committee. The Audit Committee reviews adequacy and effectiveness of the Company''s
internal control environment and monitors the implementation of audit recommendations.

The audit function maintains its independence and objectivity while carrying out assignments. It evaluates on a continuous
basis, the adequacy and effectiveness of internal control mechanism. The function also proactively recommends
improvement in policies and processes, suggests streamlining of controls against various risks.

Your Company has laid down set of standards, processes and structure, which enables it to implement internal financial
control across the Company and ensure that the same are adequate and operating effectively.

REPORTING OF FRAUDS BY AUDITORS

During the year under review, neither the Statutory Auditors nor the Secretarial Auditor has reported to the Audit
Committee under Section 143(12) of the Act any instance of fraud committed against the Company by its officers or
employees.

DIRECTORS’ RESPONSIBILITY STATEMENT

As required under Section 134(5) of the Act, for the financial year ended on March 31, 2025, the Directors hereby confirm
that:

» In the preparation of the annual financial statements for the year ended March 31, 2025, the applicable accounting
standards read with the requirements set out under Schedule III to the Act have been followed and there were no
material departures from the same;

» The Directors have selected such accounting policies and applied them consistently and made judgments and
estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company
and of the profit of the Company for the year ended on that date;

» The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in
accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities;

» The Directors have prepared the annual accounts on a going concern basis;

» The Directors have laid down adequate internal financial controls to be followed by the Company and that the
financial controls were adequate and were operating effectively;

» The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and were
adequate and operating effectively.

COMPLIANCE WITH MATERNITY BENEFIT

The Company has complied with the provisions of the Maternity Benefit Act, 1961 during the financial year under
review. All eligible women employees were extended the benefits as prescribed under the Act, including paid maternity
leave, nursing breaks, and creche facility (where applicable). The Company remains committed to ensuring a safe,
inclusive and supportive work environment for all its employees.

REPORT ON CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION

The Company has taken adequate steps to adhere to all the stipulations laid down in the SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015, Chapter IX (Corporate Governance) of Master Directions Non-Banking
Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021 and the Companies Act, 2013 and Rules
thereto, as amended from time to time.

Pursuant to the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, RBI Directions and
disclosures as required under the Companies Act, 2013 and the Rules thereto, a separate Section titled ‘Report on Corporate
Governance'' forms part of this Annual Report as Annexure IV.

The certificate issued by Mr. M/s. D.M. Zaveri & Co. confirming compliance with the conditions of Corporate Governance
as stipulated in the SEBI (LODR) Regulations, 2015 & forms part of this report as Annexure V.

The said certificate for financial year 2024-25 does not contain any qualification, reservation or adverse remarks.

In terms of Section 136 of The Companies Act, 2013, the reports and accounts are being sent to the members and others
entitled thereto.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Pursuant to Regulation 34 of the Securities and Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015, Management''s Discussion and Analysis Report, for the year under review, is presented
as separate section forming part of this Annual Report.

ANNUAL RETURN

Pursuant to section 92(3) read with Section 134(3)(a) of the Act, the Annual Return is available on the Company''s
website and can be accessed under the annual return tab at https://www.starhfl.com/disclosure-under-regula-
tion-46-of-sebi-lodr-2015/

ENHANCING SHAREHOLDERS WEALTH

Your Company believes that its Members are among its most important stakeholders. Accordingly, your Company''s
operations are committed to the pursuit of achieving high levels of operating performance and cost competitiveness,
consolidating and building for growth, enhancing the productive asset and resource base and nurturing overall
corporate reputation. Your Company is also committed to creating value for its other stakeholders by ensuring that its
corporate actions positively impact the socio-economic and environmental dimensions and contribute to sustainable
growth and development.

OUTLOOK

» Focus on growth of Individual home loans segment.

» Making online loan application more effective and enhance its contribution towards the incremental business.

» Strengthening marketing offices opened during the last 3 years and making them high growth centers.

» To grow business qualitatively by consolidating position and strengthening the competitiveness on service delivery.
» Understanding the inherent risks to the business and managing it effectively.

» Widespread market studies assisting modelling of loan products to suit customer needs.

» Making use of information provided by marketing offices about ground market conditions.

INSOLVENCY AND BANKRUPTCY

The Company has not made any application or no proceeding is pending under the Insolvency and Bankruptcy Code,
2016 during the Financial Year and hence not being commented upon.

THE DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE
TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN
FROM THE BANKS OR FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF.

During the Financial Year under review, there has been no incident of one time settlement for loan taken from the banks
of financial institutions and hence not being commented upon.

ACKNOWLEDGEMENTS

Your Board of Directors take this opportunity to express their appreciation to all stakeholders of the Company including
the Reserve Bank of India, National Housing Bank, the Ministry of Corporate Affairs, Securities and Exchange Board of
India, the Government of India, Stock Exchanges and other Regulatory Authorities, Bankers, Lenders, Financial
Institutions, Members, Credit Rating agencies, Customers of the Company for their continued support and trust. Your
directors would like to express deep appreciation for the commitment shown by the employees in supporting the
Company in achieving continued robust performance on all fronts.

In closing, we would like to thank all the investors as well as the communities we operate in who have reposed their
trust in us and supported us in our journey.

FOR AND ON BEHALF OF THE BOARD
Star Housing Finance Limited

Sd/- Sd/-

Kalpesh Dave Kavish Jain

Director & Chief Executive Officer Director

DIN: 08221964 DIN: 02041197

Place: Mumbai
Date: 14-08-2025

1

Mr. B.S. Kachhawaha, Chief Compliance Officer, resigned from his position w.e.f. 14th May 2025 and Mr. Natesh Narayanan, Chief
Financial Officer, resigned from his position w.e.f 15th June 2025

---

Mar 31, 2024

The Board of Directors are pleased to present the Company''s Nineteenth Director Report on the business & operations of the Company, together with the Audited Financial Statement for the financial year ended March 31, 2024.

FINANCIAL SUMMARY OR HIGHLIGHTS/PERFORMANCE OF THE COMPANY_

The Company''s financial performance for the financial year ended March 31st, 2024, is summarized as below:

				(INR in Lakh)
PARTICULARS		YEAR ENDED 31ST MARCH, 2024		YEAR ENDED 31ST MARCH, 2023
Gross Income		6,163.55		3724.31
Less : Finance Cost		2,782.78		1128.84
Employee Benefit Exp.		1,320.53		950.25
Overhead		666.15		745.34
Depreciation		66.71		35.55
Impairment of Financial instruments		180.26		62.70
PROFIT BEFORE TAX		1,147.12		801.63
Less : Provision for taxation		258.79		103.64
PROFIT AFTER TAX		888.33		697.99
Balance Brought Forward from last year		1,627.49		1,119.10
Appropriations		888.33		697.99
Transferred to Statutory Reserve under Section 36(1)(viii) of the Income Tax Act, 1961 read with Section 29C of National Housing Bank Act, 1987		229.42		160.33
TRANSFERRED TO GENERAL RESERVE		Nil		Nil
OTHERS		43.09		29.27
BALANCE CARRIED OVER TO THE BALANCE SHEET		2,243.30		1627.49
Return on Net Worth (%)		7.42 %		8.19%
Return on Total Assets (%)		2.29%		3.18%
EPS (Basic) (in Rs.)		1.14		0.97
Debt Equity Ratio (times)		2.41		1.53
Average Cost of Funds (%)		11.50%		9.29%
Average Yield on advances (%)		16.96%		18.66%
Net Interest Margin (%)		7.86%		11.90%

BUSINESS PERFORMANCE:
KEY FACTORS	2023-24	2022-23	GROWTH (%)
Loan Portfolio (Rs. In Lakhs)	42,686.39	24,600.10	73.52%
EPS (Basic) (in Rs.)	1.14	0.97
CRAR (%)	54.65%	77.88%	(17.85%)

Note: Figures of the previous year/ period have been regrouped and/or reclassified whenever necessary while preparing the statement as per IND-AS requirements.

DIVIDEND_

The Company has in place a Dividend Distribution Policy formulated in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“Listing Regulations”), which intends to ensure that a rationale decision is taken, with regard to the amount to be distributed to the shareholders as dividend, after retaining sufficient funds for the Company''s growth, to meet its long-term objective and other purposes. The Policy also lays down various parameters to be considered by the Board of Directors of the Company before recommendation of dividend to the Members of the Company.

Considering the performance of the Company during the financial year 2023-2024, the Board of Directors felt the need to strike a balance between being prudent and conserving capital in the Company, while at the same time catering to the expectations of shareholders, and also considering the Dividend Distribution Policy and in terms of RBI Circular No. DOR.ACC.REC.No.23/21.02.067/2021-22 dated 24th June, 2021, have recommended payment of final dividend amounting to Rs. 0.075 per equity share of Rs.5/- for the financial year ended March 31, 2024 in its meeting held on 25th July, 2024. The dividend payable shall be subject to the approval of the Members at the 19th Annual General Meeting (‘AGM'').

The dividend declared by the Company for the financial year ended 31st March, 2024 is in compliance with the Dividend Distribution Policy of the Company. The Dividend Distribution Policy is available on the website of the Company at https://www.starhfl.com/wp-content/uploads/2023/02/Dividend-Distribution-Policy.pdf

TRANSFER TO RESERVES_

During the year under review, your Company appropriated Rs. 229.42 Lakhs to the Statutory Reserve under Section 36(1) (viii) of the income Tax Act, 1961 read with Section 29C of National Housing Bank (NHB) Act, 1987 out of the amount available for appropriation and an amount of Rs. 888.33 Lakhs is proposed to be retained in the Profit and Loss Account.

REGULATORY COMPLIANCE_

Following the amendment in the Finance Act, 2019 and the subsequent notification by the Reserve Bank of India (RBI) in August 2019, HFCs are being treated as one of the categories of Non-Banking Financial Companies (NBFCs) for regulatory purposes and accordingly come under RBI''s direct oversight. The National Housing Banks (NHB), however, would continue to carry out supervision of HFCs. In this regard Master Direction - Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021 was notified on 17th February, 2021 in supersession of the regulations/ directions as given in Chapter XVII of these directions.

The Company has been following guidelines, circulars and directions issued by the RBI/ NHB, from time to time. The Company has complied with the Master Direction-Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021 including amendments thereof and other directions/guidelines prescribed by RBI regarding, accounting standards, prudential norms, capital adequacy, credit rating, corporate governance, liquidity, information technology framework, fraud monitoring, concentration of investments, risk management, capital market exposure norms, Know Your Customer, Anti-Money Laundering and the Company also adopted the guidelines on maintenance of Liquidity Coverage Ratio with effect from 1st December, 2021, as per RBI master directions.

The Company also has been following Directions / Guidelines / Circulars issued by SEBI, MCA, NHB and RBI from time to time, as applicable to a Listed Company.

SHARE CAPITAL_

? Authorized Share Capital

During the year, the company''s Authorized share capital remain unchanged. Hence, the authorized share capital of the Company as at March 31, 2024 was Rs. 50,00,00,000 (Rupees Fifty Crore only) consisting of 10,00,00,000 (Ten Crore) equity shares of Rs. 5 (Rupees Five) each.

? Issued and Paid-up Capital

The paid-up Equity Share Capital of the company as on March 31, 2024 is Rs. 39,36,03,080 (divided into 7,87,20,616 Equity Shares of Rs. 5/-each).

During the year under review:

a) The Board of Directors of the Company in their meeting held on 27th June, 2023 allotted 60,000 fully paid up equity shares of face value Rs. 5/- each and on 08th November, 2023 allotted 15,02,350 fully paid up equity shares of face value

Rs. 5/- each ESOP under “Akme Employee Stock Option Plan 2021.”The disclosure with regard to ESOP as required under the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations 2021 is available on the website of the Company at: www.starhfl.com.

b) The company has issued & allotted 93,78,500 convertible warrants of Rs. 5/- each at Rs. 64 /- per warrant (including a premium of Rs. 59/- per share) under preferential allotment on a private placement basis for cash consideration through approval accorded by the shareholders at the Extra Ordinary General Meeting held on 06th December, 2023 . These warrants shall be converted into equity shares within 18 months from the date of the allotment. The resulting equity shares shall rank pari-passu with the existing equity shares of the company. Proceeds of the said Preferential Issue were utilized for expansion of business, general corporate purposes and working capital requirements. Therefore, there are no details to be disclosed as per Regulations 32(7A) of the SEBI Listing Regulations.

Changes after the Financial Year:

a) The Board of Directors of the Company in their meeting held on 18th June, 2024 allotted 60,000 fully paid up equity shares of face value Rs. 5/- each ESOP under “Akme Employee Stock Option Plan 2021.”

Apart from the above, there was no change in the structure of the paid up share capital.

CREDIT RATING_

The following ratings have been reaffirmed/assigned to the Company for its Bank Loan and Non-Convertible Debentures

(NCDs) during the Year by India Ratings & Research Agency & CareEdge Ratings Agency:

SR.NO. NAME OF RATING AGENCY	FACILITIES	LIMITS (IN MILLION)	TENURE	RATING	RATING ACTION
1 India Ratings & Research Agency	Bank Loans	1590	Long Term	IND BBB/ Stable	Upgraded
2 India Ratings & Research Agency	Bank Loans	1590	Long Term	IND BBB/ Stable	Affirmed
3 India Ratings & Research Agency	Bank Loans	2910	Long Term	IND BBB/ Stable	Assigned
4 India Ratings & Research Agency	Non-Convertible Debentures (NCDs)	500	Long Term	IND BBB/ Stable	Assigned
NAME OF RATING AGENCY	FACILITIES	LIMITS (IN MILLION)	TENURE	RATING	RATING ACTION
CareEdge Ratings	Bank Loans	1670	Long Term	CARE BBB; Stable (Triple B; Outlook: Stable)	Revised from CARE BBB-; Positive (Triple B Minus; Outlook: Positive)
CareEdge Ratings	Bank Loans	Increased from Rs. 1670 mn to Rs. 3000 mn	Long Term	CARE BBB; Stable (Triple B; Outlook: Stable)	Reaffirmed
The following ratings have been reaffirmed/assigned to the Company for its bank facilities after the Closure of financial
Year by India Ratings
NAME OF RATING AGENCY	FACILITIES	LIMITS (IN MILLION)	TENURE	RATING	RATING ACTION
India Ratings & Research Agency	Bank Loans	4500	Long Term	IND BBB/Stable	Affirmed
India Ratings & Research Agency	Non-Convertible Debentures (NCDs)	500	Long Term	IND BBB/Stable	Assigned

TERM LOANS
A. BORROWING (OTHER THEN DEBT SECURITIES) During the financial year 2023-24 your company raised term loans of Rs. 193.	42 crores from the following institutions:
NAME OF THE INSTITUTION	AMOUNT RAISED (RS IN CRORES)
Sundaram Home Finance Limited	15.00
MAS Financial Services Limited	12.50
Hinduja Housing Finance Limited	9.50
Additional refinance Assistance from National Housing Bank	50.00
IDBI Bank Limited	10.00
ICICI Bank Limited	2.92
Tata Capital Financial Services Limited	6.00
MAS Rural Housing & Mortgage Finance Limited	2.50
SBICAP Trustee Company Limited (LIC Housing Finance Limited)	30.00
ESAF Small Finance Bank Limited	5.00
State Bank of India	50.00
Total	193.42

The Outstanding Borrowings (other then debt securities) as on 31.03.2024 stood at Rs.292.16 Crores.

B. NON-CONVERTIBLE DEBENTURES

Your Company has issued Secured Non-Convertible Debentures (NCDs) of Rs. 31 Crores during the year under review, on private placement basis. The details of the same are as follows:

NAME OF THE ALLOTTEE	DATE OF ALLOTMENT	NO. OF DEBENTURES	FACE VALUE	TOTAL CONSIDERATION
Northern Arc Capital Private Limited	19th October, 2023	2000	1,00,000	20,00,00,000
AK Securitization & Credit Opportunities Fund II	12th March, 2024	1100	1,00,000	11,00,00,000

The total secured Non-Convertible Debentures outstanding as on March 31, 2024 is 28.14 Crores.

Your company affirms that there has been no deviation or variation in the utilization of proceeds of NCDs issue, from the objects stated in offer document(s).

Pursuant to NBFC-HFCs (RBI) Master Directions, 2021, the following statement is provided -
Total No. of NCDs which have not been claimed by the Investors or paid by the Company after the date on which NCDs became due for redemption.	Nil
Total Amount in respect of NCDs remaining unclaimed / unpaid beyond due date	Nil

REVIEW OF OPERATIONS_

Your Company is registered as a Housing Finance Company (HFC) with RBI to carry out the housing finance activities in India.

In accordance with the Master Direction - Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021, Housing finance company” shall mean a company incorporated under the Companies Act, 2013 that fulfils the following conditions:

a) It is an NBFC whose financial assets, in the business of providing finance for housing, constitute at least 60% of its total assets (netted off by intangible assets).

b) Out of the total assets (netted off by intangible assets), not less than 50% should be by way of housing financing for individuals.

The Company meets the aforesaid principal business criteria for HFCs.

To build a quality loan book, your Company endeavors to adopt superior underwriting practices backed by robust monitoring and recovery mechanism. Your Company is committed towards improving efficiency in all its processes and service levels for its customers.

Your Company''s thrust continues to be the affordable housing segment, with its focus on catering to the aspirations of low and middle-income Indian families who dream to own their homes. Your Company has been facilitating credit access to the low and middle-income self-employed customers in semi-urban and rural areas in India. The majority of your Company''s customers have limited access to formal banking credit facilities.

During the Financial Year under review, your Company delivered a resilient performance, which is reflected in the following financial snapshot:

? Income & Profits

Total Revenue from operations increased by 65.49 % to Rs. 6,163.55 Lakhs for the Financial Year ended March 31, 2024 as compared to Rs. 3,724.31 Lakhs for the previous Financial Year. Profit before Tax (PBT) was 43.10 % higher at Rs. 1,147.12 Lakhs as compared to Rs. 801.63 Lakhs for the previous Financial Year. The Total Comprehensive Income for the Financial Year 2023-24 increased by 48.11% from Rs. 593.75 in the Financial Year to Rs. 879.39 Lakhs in the Previous Financial Year.

? Sanctions

During the Financial Year under review, your Company sanctioned housing loans of Rs. 23,796.11 Lakhs as compared to Rs. 19,901.83 Lakhs sanctioned in the previous Financial Year registering a growth of 19.57 % .The cumulative loan sanctions since inception of your Company stood at Rs. 63,324.95 Lakhs as at March 31, 2024.

? Disbursements

During the Financial Year under review, your Company disbursed loans of Rs. 24,072.63 Lakhs (including off balance sheet disbursement of Rs. 3,592.33 lacs) as compared to Rs 20,750.91 Lakhs (including off balance sheet disbursement of Rs.2,071.09 Lakhs) disbursed in the previous Financial Year and recorded growth of 16.01%.

? Capital Adequacy

The Company has been maintaining the Capital Adequacy Ratio (CAR) above the minimum required level prescribed by National Housing Bank (NHB) / Reserve Bank of India (RBI) from time to time.

The Capital Adequacy Ratio of the Company as at March 31, 2024 is 54.65 % as against 77.88 % as at March 31, 2023.

? Assets Under Management (AUM)

The AUM of your company stood at Rs. 42,686.39 Lakhs (including off balance sheet AUM of Rs.4,396.10 Lakhs) as at March 31, 2024 as against Rs. 24,600.10 Lakhs (including off balance sheet AUM of Rs.1891.60 Lakhs) in the previous financial year, registering a growth of 73.52%.

Prudential Norms for the HFCs Issued By RBI:

A discussion paper titled ‘Revised Regulatory Framework for NBFCs - A Scale-based Approach'' was issued for public comments on January 22, 2021. Based on the inputs received, the RBI has put in place a revised regulatory framework for NBFCs on October 22, 2021.

Regulatory structure for NBFCs shall comprise of four layers based on their size, activity, and perceived risk. NBFCs in the lowest layer shall be known as NBFC - Base Layer (NBFC-BL). NBFCs in middle layer and upper layer shall be known as NBFC - Middle Layer (NBFC-ML) and NBFC - Upper Layer (NBFC-UL) respectively. The Top Layer is ideally expected to be empty and will be known as NBFC - Top Layer (NBFC-TL).

As the SBR framework encompasses different facets of regulation of NBFCs covering capital requirements, governance standards, prudential regulation, etc., RBI issued an integrated regulatory framework for NBFCs under SBR providing a holistic view of the SBR structure. These revised regulatory framework has come into effect from October 01, 2023.

According to these Directions, all HFCs fall under the category of Middle layer for the purpose of regulation and supervision. The company has put in place all the necessary steps in this direction to comply with the new Regulatory framework.

Asset Classification and Provisioning Norms:

The RBI has come out with certain clarifications on Income Recognition, Asset Classifications and Provisioning norms with a view to have a uniformity across all the lending institutions including HFCs vide their notification dated November, 12 2021. As per the notification, all the NBFCs have to specify the exact due dates of loan repayment alongwith the methodolory of SMA/NPA classifications reckoning from the due dates, in their loan agreements. Upgradation of accounts classified as NPA to STANDARD may be done only if entire arrears of interest and principal are paid by the borrower. Further, the companies would also provide consumer education literature on their websites explaining with examples, the concepts of overdue SMA and NPA classification and upgradation of accounts. The company has been complying with these instructions meticulously.

PROSPECTS AND DEVELOPMENTS_

There is a very huge market to be served, which needs an efficient last mile delivery of credit, thus creating enormous opportunity for all the financial institutions and HFCs in special. The Company continues to pursue the strategy of being multi-product and multi-location, thus giving the distinct edge from the risk management and scalability perspective. The focus across the product is of catering to the lower and the middle income segment, which are the key drivers of our economy.

HOUSING FINANCE_

The Company aims at serving the middle income and the lower income sector of the economy, especially in the semi urban and rural areas, which are reckoned to be the key drivers of the sector in the coming decades. Full-fledged efforts are on to execute efficiently, as per the detail planning. Being aware of the challenges involved in serving this class of the society, a very cautious approach is adopted in building up volumes. Nevertheless, Company is quite confident of building substantial volumes in the near future. The Company''s rural initiative will also start yielding results shortly. It is worth mentioning that despite the creditworthy customer class, ascertaining the title of the property remains a challenging job. The Company is actively involved with all the stakeholders to smoothen the process and is assertive in getting the right set of documents. We continue to endeavor relentlessly and are confident of creating a quality portfolio and add value to the ecosystem we work in.

DISTRIBUTION NETWORK_

Your company has been successful in continuous expansion of its branch network with a view to support its disbursement growth, deeper penetration in the states in which the Company operates and enhancing customer reach. During the Financial Year under review, the Company has expanded its branch network to 6 states with 34 branches as on March 31, 2024. Your Company operates in Akola, Baramati, Chennai, Hingoli, Indore, Jaipur, Jalgoan, Mahad, Nashik, Pune, Udaipur, Rajsamand, Surat. Devas, Ahmednagar, Vapi,Vyara, Pithampur, Khargone, Chalisgaon, Kalyan,Kolhapur,Washim, Panvel, Vashi, Buldhan,Hapur,Meerut, Ghazibad, Dudu,Kanchipuram, Sholinghur,Vellore and Udaipur RO.

HUMAN RESOURCE MANAGEMENT_

During the year, the HR continued to provide timely on-board experienced resources across all locations, imparting functional and system training to develop productive resources for all the functional teams. The Company also gives an opportunity to identify and develop the internal talent pool. The Company hired professionals at senior positions as Functional Heads for heading the various Departments of the Company, having relevant industry experience and expertise to strengthen and grow the housing finance business of the Company.

The Company''s success depends largely upon the quality and competence of its Management team and key personnel. Attracting and retaining talented professionals is therefore a key element of the Company''s strategy and a significant source of competitive advantage. The Company has a diverse workforce of 256 employees as on March 31, 2024.

Human resource development is considered vital for effective implementation of business plans. Constant endeavors are being made to offer professional growth opportunities and recognition, apart from imparting training to the employees at all levels. Your Company has also provided the sales training to the new recruits to provide them better understanding of the Company and align them towards the working culture of the Company.

Your Company will always strive to strengthen this most important resource in its quest to have enabling human capital.

CAPITAL AND LIABILITY MANAGEMENT_

The Company in tandem with its philosophy of pursuing the mission of “Excellence through Endeavors” will strive to maximize the shareholders'' value. The Company continues to pursue an efficient capital management policy, which aims at maximizing the return on capital employed and at the same time adhering to the prudential guidelines laid down by RBI/NHB from time to time.

The Company by virtue of its performance over the years enjoys very good relationships with many leading banks and financial institutions. The Company could raise the required resources from various banks and financial institutions easily. We anticipate the same response from all our lending partners for the coming years too. The Company anticipates credit lines from few more banks and financial institutions besides the existing ones.

During the year passed by when the whole sector was looked upon as a risky proposition the Company could not only manage to raise the required resources but also obtained credit lines for the coming year.

Your Company continues to command the respect and the confidence of Bankers as their extended channel in their task of providing efficient delivery of credit. The company acknowledges the constructive support of the Investors and Banks.

RESOURCE MOBILISATION_

Your Company''s borrowing policy is under the control of the Board. The Company has vide special resolution passed on 10th August, 2023, under Section 180 (1) (a) & 180(1)(c) of the Companies Act, 2013, authorized the Board of Directors to borrow money upon such terms and conditions as the Board may think fit in excess of aggregate of paid up share capital, free reserves, security premium of the Company up to an amount of Rs. 700 crore and the total amount so borrowed shall be within the limits as prescribed under the regulatory directions issued from time to time. The prevalent relevant directions issued by RBI under Master Direction - Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021are being complied with.

Your Company continued to use a variety of funding sources to optimize funding costs, protect interest margins and maintain a diverse funding portfolio which further strengthened its funding stability and liquidity needs. Your Company continued to keep tight control over the cost of borrowings through negotiations with lenders and thus, raised resources at competitive rates from its lenders while ensuring proper asset liability match.

Your Company continued to diversify its funding sources by exploring the Capital Market through private placement to Financial Institution, Banks, NHB Refinance, NHB SRF (Special Refinance Facility Assistance), NHB''s LIFT (Liquidity infusion scheme).

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS_

The details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013, apart from the loans made, guarantee given or security provided by the Company in the ordinary course of business are given in the Notes to accounts forming part of the Audited Financial Statements for the year ended March 31, 2024.

ALTERATION IN MEMORANDUM AND ARTICLES OF ASSOCIATION_

The Company has made alteration in the Object Clause of the Memorandum of Association of the Company in accordance with the provisions of Companies Act, 2013 by passing Special Resolution through Postal Ballot on 21st February, 2024, as follows:

a Under Clause III (A): The below mentioned sub-clause was inserted after existing S. No (2)

3. “To solicit and procure insurance business as Corporate Agent and to undertake such other activities as are incidental or ancillary thereto.”

b Under Clause III (B): The below mentioned sub-clause was inserted after existing S. No (35)

36.“To render services relating to Marketing, Advisory, Processing, Consultancy, Advertising, Promotion, Distribution, Agency, Sub-letting and collect fees/commission/brokerage including revenue generation thereon so as to directly or indirectly benefit the company.”

c Under Clause III (B): The existing sub-clause 2 was substituted by the below mentioned sub-clause:

2. “Subject to Section 73 of the Companies Act, 2013 and the rules framed there under and the directive by the Reserve Bank of India, to borrow or raise money or to take money on loan on interest from banks, financial institutions, government agencies, co-operative societies, persons, companies, firm, in such manner as the Company may think fit and in particular by the issue of debentures or debenture stock, perpetual including debentures or debenture stock convertible into shares of this Company or perpetual annuities and in security of any such money borrowed, raised or received to mortgage, pledge, hypothecate, or charge the whole or any part of the properties (movable or immovable) assets or revenue of the Company present or future including its uncalled capital by special assignments or to transfer or convey the same absolutely or in trust and to give the lenders power of sale and other powers as may be deemed expedient and to purchase, redeem or pay off any such securities. The Company shall not carry on any banking business which may fall within the purview of Banking Regulations Act, 1949.”

The Company deleted below the mentioned Clause of the Article of Association of the Company in accordance with the provisions of Companies Act, 2013 by passing Special Resolution in the Annual General Meeting held on 10th August, 2023.

Common Seal

156 The Board shall provide a common seal of the Company and shall have power from time to time to destroy the same and substitute a new seal in lieu thereof. The common seal shall be kept at the Registered Office of the Company and committed to the custody of the Directors.

Affixture of Common Seal

157 The Common Seal of the Company. If required to be affix, shall be affixed to any instrument(s) in the presence of any of the Director or of the company and/or Chief Financial officer and/or Company secretary and/or such person(s) as the authorized by the Board or Committee or aforesaid persons may appoint for them purpose and who shall sign every instrument which the seal of the company is so affixed in their presence.

NON-PERFORMING ASSETS AND PROVISIONS FOR CONTINGENCY_

The Gross NPA of your Company as on March 31, 2024 was Rs.572.56 Lakhs; 1.50 % (previous year 381.12 Lakhs; 1.68 %). The Net NPA as on March 31, 2024 was Rs. 388.90 Lakhs; 1.02 % (previous year 282.44 Lakhs; 1.25 %). The regulatory and compliance reporting, has been done in accordance with the prudential guidelines for Non-Performing Assets (NPAs) issued by the Reserve Bank of India under Master Direction - Non Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021.

A detailed comparison of asset classification as per the Ind AS provisions and IRACP norms has been provided under Point No. 9 of Disclosures required by Reserve Bank of India/National Housing Bank forming part of the Financial Statements.

Your Company has made adequate provision for the assets on which installments are overdue for more than 90 days and on other assets, as required. For details on the impairment provisioning, please refer to annexure no.9 of disclosures required by RBI/NHB to the financial statements. By way of prudence and abundant caution, Company has provided additional provision over and above the RBI guidelines as on March 31, 2024.

The Company has maintained cumulative NPA provision of Rs. 183.66 lakhs against the required provision of Rs. 143.57 lakhs. Further for standard assets Company carries provision of Rs. 65.99 lakhs.

DETAILS RELATING TO DEPOSITS_

The Company has been granted registration by the Reserve Bank of India as a non-deposit taking Housing Finance Company. Being so, the Company has neither accepted in the past nor has any future plans to accept any public deposits, by whatever name called.

GOVERNMENT POLICIES FOR THE HOUSING FINANCE COMPANIES_

The master directions issued by the RBI on 17 February 2021 are expected to bring in greater discipline by way of detailed regulatory requirements which will bring about more transparency and compliance in the housing finance sector.

The central bank''s mandate regarding liquidity buffer with respect to liquidity coverage ratio (LCR) is expected to enhance HFCs'' resilience to potential disruptions to liquidity. This will be on account of HFCs maintaining sufficient high-quality liquid assets to mitigate any acute liquidity stress scenarios lasting 30 days.

The RBI''s master directions on HFCs detailed the purview of housing finance to include financing for purchase/construction/ reconstruction/repairs and renovation of housing dwelling units. With this, the RBI brought companies engaged in construction finance also under the ambit of these directions thereby increasing the scope of its supervision and enhancing the transparency across the construction value chain.

The regulations pertaining to HFCs were with the extant NBFC regulations. The RBI maintained the flexibility of the HFCs with respect to risk weights, as NBFCs generally have lesser flexibility for risk weights, which are broadly classified into 0%, 20% and 100%. As the flexibility has been continued, the HFCs would not require additional capital to service the same Loan Book and can maintain the current levels, subject of course to minimum capital requirements.

As the larger HFCs already meet the above guidelines, they are unlikely to face significant challenges when HFC regulations are further harmonized with NBFCs going forward.

BSE COMPLIANCES_

The Company has submitted compliances as required quarterly/half yearly/ yearly in accordance with the prescribed guidelines.

INVESTOR COMPLAINTS AND COMPLIANCE_

The Company received nil investor complaint during the year and the same was submitted to BSE pursuant to SEBI (LODR) Regulations, 2015.

TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND_

In accordance with the provisions of Sections 124, 125 and other applicable provisions, if any, of the Act, read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (hereinafter referred to as ‘IEPF Rules'') (including any statutory modification(s) or re-enactment(s) thereof for the time being in force), the amount of dividend remaining unclaimed or unpaid for a period of 7 (Seven) years from the date of transfer to the Unpaid Dividend Account is required to be transferred to the Investor Education and Protection Fund (IEPF) maintained by the Central Government. Further as per the provisions of Section 124(6) of the Act read with IEPF Rules, the shares in respect of which dividend has not been paid or claimed by the Shareholders for 7 (Seven) consecutive years or more are also required to be transferred to the designated demat account created by the IEPF Authority.

Your Company does not have any funds lying unpaid or unclaimed for a period of seven years. Therefore, there are no funds which were required to be transferred to IEPF till the date of this Report.

MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE COMPANY FROM THE END OF FINANCIAL YEAR TILL THE DATE OF REPORT:_

Following changes took place from the end of financial year till the date of report:

1. Mr. Kalpesh Dave-Chief Executive Officer of the Company has been appointed as Chief Executive Officer and Executive Director (Additional) vide Board Meeting dated 18.06.2024 subject to RBI approval.

2. Mr. Ajit Kumar Satpathy has been appointed as Chief Risk Officer of the Company vide Board Meeting dated 18.06.2024 for a tenure of 3 years wef_1st July, 2024.

3. Mr. Ashish Jain has resigned from the position of Managing Director & Chairman of the Company with effect from 30.06.2024 vide his letter dated 28.06.2024 and accepted by Board of Directors of the Company vide dated July 25, 2024 subject to RBI Approval.

PROVISION OF FINANCIAL ASSISTANCE TO THE EMPLOYEES OF THE COMPANY FOR THE PURCHASE OF ITS OWN SHARES:_

The company has not provided any financial assistance to its employees as per Section 67 of the Companies Act, 2013 (the ‘Act”) for the purchase of its own shares.

SUBSIDIARY, JOINT VENTURES AND ASSOCIATE COMPANIES_

As on March 31,2024 the Company does not have any Subsidiary Company or Joint Venture Company or Associate Company.

PARTICULARS OF EMPLOYEES_

In terms of Section 197 of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the disclosures with respect to the remuneration of Directors, Key Managerial Personnel and Employees of the Company have been provided in Annexure VIII to this Board''s Report. Further, statement containing details of employees as required in terms of Section 197 of the Act read with Rule 5(2) and Rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is available for inspection at the Registered Office of the Company during working hours for a period of 21 days before the date of the ensuing Annual General Meeting. A copy of the statement may be obtained by shareholders by writing to the Company Secretary at the Registered & Corporate Office of the Company or at [email protected].

PARTICULARS OF CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNING AND OUTGO:_

In accordance with the provision of sec 134(3) (m) of the Act, read with Rule 8 of the Companies(Accounts) Rules 2014 the requisite information relating to your Company are as under:-

A. Conservation of energy:

The Company does not fall under any of the industries covered by the Companies (Disclosure of particulars of Directors) Rules, 1988.

B. Technology absorption:

Your company has implemented a next generation, core housing virtual solution, with the purpose of aligning itself with the fast growing technology evolution and leveraging operational capabilities, while reducing the time taken for whole loan process. The company has inter-connected different branches with the head office in a safe, secure and reliable 360 degree cloud platform. For the aforesaid purpose, your company has signed-up with Jaguar Software India & IXL (Mobility Solutions) in 2019-2020 and customized it with the practical needs to area of operation of company, which results in following benefits:

? Digitization of documents

? Centralization of all branches with corporate /registered office

? Speed-up the loan process

? Single- Click Report Generation

? “Inter-departmental solution (robust the collaboration)

? Android / iOs app based system for field staff to submit initial documents and verification remarks

? Saving cost in logistics, handling, printing, and mitigating risk of physical movements.

? Improves the quality of credit analysis.

? Secured and Safe cloud based system with end to end encryption.

? Predefined roles with maker-checker concept, with final approval authority to Managing director/ Authorized Personnel

? Keeping of Digital trails which can keep the whole loan process details in one click and useful during audit(s) and tracing purpose.

? Simplification of work flow, with regular MIS.

Jaguar Software India as a service provider / software vendor provides applicable upgrades and latest security protocols as and when needed.

The RBI vide its Master Direction - Information Technology Framework for the NBFC Sector dated November 7, 2023, which shall apply mutatis mutandis to all HFCs also, had notified Information technology framework (guidelines) for all NBFCs including Housing Finance companies (‘HFCs'') to enhance safety, security, efficiency in process leading to benefit for HFCs and their customer.

Your company is in compliance with the aforesaid guidelines.

Your company does not have any foreign exchange earnings and outgo during the year under review.

RISK MANAGEMENT FRAMEWORK_

With the challenging macroeconomic conditions and uncertainties, there are heightened risks faced by the Company which can be inherent or market-related risks. There has been a continuous focus on identifying, measuring and mitigating risks by the Company. As a housing finance company, the Company is exposed to various risks like credit risk, market risk (interest rate and currency risk), liquidity risk and operational risk (technology, employee, transaction and reputation risk). A key risk in the competitive home loans, and mortgage-backed funding in general is losing customers that transfer out their loans for small gains in interest rates, this represents a significant loss of opportunity to the Company given the long-term nature of mortgage loans. To identify and mitigate all these risks, the Company has an effective Risk Management Control Framework that has been developed compassing all the above areas.

The Company has a Risk Management Committee (RMC). The RMC has met three times during the year and kept an active watch on the emergent risks the Company come across during the course of business. The Risk Management Committee

oversees the process of identification, measurement and mitigation of risks.

During the Financial Year under review, the Risk Management Committee reviewed the risks associated with the business of your Company, undertook its root cause analysis and monitored the efficacy of the measures taken to mitigate the same.

The Board of Directors in its meeting held on 18.06.2024 has appointed Mr. Ajit Kumar Satpathy as Chief Risk Officer of the Company for a tenure of 3 years w.e.f._01.07.2024 to function independently and ensure highest standards of risk management.

The Company has a Risk Management Policy in place and the same can be accessed on the website of the Company at https://www.starhfl.com/wp-content/uploads/2023/12/1.-Risk-Management-Policy.pdf.

ASSET LIABILITY MANAGEMENT COMMITTEE (ALCO)_

The Asset Liability Management Committee (ALCO) lays down policies and quantitative limits that involve assessment of various types of risks and shifts in assets and liabilities to manage such risks. ALCO ensures that the liquidity and interest Rate risks are contained within the limits laid down by the Board. The Company has duly implemented the RBI''s Asset Liability Management Guidelines.

VIGIL MECHANISM/WHISTLE BLOWER POLICY_

Pursuant to the provisions of Section 177 (9) & (10) of the Companies Act, 2013 read with Rule 7 of Companies (Meetings of Board and its Powers) Rules, 2014 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has in place a Whistle Blower Policy, which provides for a framework to report the genuine concerns against the suspected or confirmed fraudulent activities, allegations of corruption, violation of the Company''s Code of Conduct.

The Company will provide adequate safeguards against victimisation of persons who use this mechanism. Such persons shall have direct access to the Chairman of the Audit Committee when appropriate.

The whistle blower policy is placed on the website of the Company and can be accessed at https://www.starhfl.com/wp-content/uploads/2024/02/Vigil-Mechanism-Whistle-Blower-Policv.pdf

CODES AND STANDARDS_

Your Company has formulated various policies and codes in compliance with provisions of Directions and Guidelines issued by the Reserve Bank of India, Companies Act, 2013, Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and to ensure high ethical standards in the overall functioning of the organization. The said policies and codes are periodically reviewed by the Board of Directors. The key policies and codes as approved by the Board of Directors and the respective compliance thereunder are detailed herein below:

(a) Know Your Customer & Anti Money Laundering Measure Policy

Your Company has approved Know Your Customer & Anti Money Laundering Measure Policy (KYC & AML Policy) in place and adheres to the said Policy. The said Policy is in line with the Reserve Bank of India Master Directions - 2016 on KYC and AML applicable to all regulated entities. The Company has also adhered to the compliance requirement in terms of the said policy relating to the monitoring and reporting of cash / suspicious transactions. The Company furnishes to Financial Intelligence Unit (FIU), India, in the electronic medium, information of all cash transactions of the value of more than Rupees ten lakh or its equivalent in foreign currency and suspicious transactions whether or not made in cash, in terms of the said policy. The policy is placed on the website of the Company and can be accessed at https://www.starhfl.com/wp-content/uploads/2024/03/Star KYC-And-AML-Policy 1.0.pdf

(b) Fair Practice Code

Your Company has in place a Fair Practice Code (FPC), which includes guidelines on appropriate staff conduct when dealing with the customers and on the organization''s policies vis-a-vis client protection. The FPC captures the spirit of the Reserve Bank of India guidelines on fair practices for Housing Finance Companies. During the year under review, FPC was modified by the Board and the grievance redressal mechanism within the Company was further strengthened. The policy is placed on the website of the Company and can be accessed at https://www.starhfl.com/wp-content/uploads/2024/03/Star Fair-Practices-Code l.Q.pdf

(c) Policy on Disclosure of material events and information

During the year under review, your Company has adopted the Policy on Disclosure of Material Events and Information, in accordance with Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 to determine the events and information which are material in nature and are required to be disclosed to the Stock Exchanges. The policy is placed on the website of the Company and can be accessed at https://www.starhfl.com/wp-content/uploads/2024/02/Disclosure-of-policv-for-determination-of-materialitv-of-events-or-information.pdf

(d) Code of Conduct for Board Members and the senior management

The Company has adopted Code of Conduct for the Board of Directors and the Senior Management Personnel to set forth the guiding principles on which the Company and its Board and Senior Management Personnel shall operate and conduct themselves with multitudinous stakeholders, government and regulatory agencies, media and anyone else with whom it is connected. The policy is placed on the website of the Company and can be accessed at https://www.starhfl.com/wp-content/uploads/2024/02/Code-of-conduct-of-Board-of-Directors-and-Senior-Management-Personnel.pdf

(e) CEO & CFO Certification

The Chief Executive Officer(CEO) and Chief Financial Officer (CFO) have certified to the Board in accordance with Regulation 17(8) read with Part B of Schedule II of the Listing Regulations pertaining to CEO/CFO certification for the financial year ended March 31, 2024, which is annexed hereto as Annexure VII.

(f) Code for Prevention of Insider Trading Practices

The Company has formulated and adopted a Code for Prevention of Insider Trading Practices in accordance with the model code of conduct as prescribed under the Securities and Exchange Board of India (Prohibition of Insider Trading) (Amendment) Regulations, 2018, as amended. The code lays down guidelines, which includes procedures to be followed and disclosures to be made while dealing in the shares of the Company. The code is applicable to the promoters, directors, senior designated employees and their dependents and the said persons are restricted from dealing in the securities of the Company during the ‘restricted trading periods'' notified by the Company, from time to time.

(g) Code of Business Ethics (COBE)

The Company has adopted a Code of Business Ethics (COBE) which lays down the principles and standards that govern the activities of the Company and its employees to ensure and promote ethical behavior within the legal framework of the organization.

The Company has a Policy on Prevention, Prohibition & Redressal of Sexual Harassment of Women at Workplace and an Internal Complaints Committee (ICC) has been constituted there under. The Policy''s primary objective is to protect the women employees from sexual harassment at the place of work and also provides for punishment in case of false and malicious representations. During the year no complaint was received in this regard.

The policy is placed on the website of the Company and can be accessed at https://www.starhfl.com/wp-content/ uploads/2023/03/Star Anti-Sexual-Harrasment-Policy 1.0.pdf.

(h) Comprehensive Risk Management Policy

The Company is committed to manage its risk in a proactive manner and has adopted a structured and disciplined approach to risk management by developing and implementing risk management framework. With a view to manage its risk effectively your Company has in place a Comprehensive Risk Management Policy which covers a formalized Risk Management Structure, along with other aspects of risk management i.e. credit risk management, operational risk management, market risk management and enterprise risk management. The Risk Management Committee of the Board, on periodic basis, oversees the risk management systems, processes and minimization procedures of the Company.

(i) Corporate Social Responsibility (CSR) Policy

The Company has Corporate Social Responsibility Policy (CSR Policy), as per the provisions of the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended, which, inter-alia, lays down the guidelines and mechanism for undertaking socially useful projects for welfare and sustainable development of the community at large. As per the provisions of Section 135 of the Companies Act, 2013, the Company has constituted a Corporate Social Responsibility Committee. The Committee assists the Board in fulfilling its duty towards the community and society at large by identifying the activities and programmers that can be undertaken by the Company, in terms of the Company''s CSR Policy. The composition

of the CSR Committee and its terms of reference are given in the Corporate Governance Report forming part of this Annual Report.

The brief outline on CSR activities is mentioned in Notes to Financial Statements forming part of the Annual Report. The policy is available on the Company''s website https://www.starhfl.com/wp-content/uploads/2024/08/CG-Policy.pdf

(j) Remuneration Policy

The Nomination and Remuneration Committee had laid down criteria for determining Director''s Qualification, Attributes and Independence of a Director, remuneration of Directors, Key Managerial Personnel and other employees and criteria for evaluation of Directors, Chairperson, Non-Executive Directors and Board and the evaluation process of the same. In this respect the Company framed the Remuneration Policy in order to align with various provisions under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and RBI Circular DOR.GOV.REC.No.29/18.10.002/2022-23 dated 29th April, 2022. The policy may be accessed on the Company''s website at https://www.starhfl.com/wp-content/ uploads/2023/06/Remuneration-Policv.pdf

(k) Related Party Transactions Policy

The Company has a Related Party Transaction Policy, intended to ensure requisite approval, reporting and disclosure of transactions between the Company and its related parties. The said policy also defines the materiality of related party transactions and lays down the procedures of dealing with related party transactions. During the year under review, the Related Party Transaction Policy was amended to align the same with the requirements of Companies (Amendment) Act, 2015 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The policy is placed on the website of the Company and can be accessed at https://www.starhfl.com/wp-content/ uploads/2023/02/Policv-on-dealing-with-Related-Partv-Transactions.pdf

(l) Familiarization Programme for Independent Directors

The objective of a familiarization programme is to ensure that the non-executive directors are updated on the business environment and overall operations of the Company. This enables the non-executive directors to make better informed decisions in the interest of the Company and its stakeholders. The policy is placed on the website of the Company and can be accessed at https://www.starhfl.com/wp-content/uploads/2023/02/2.-Familiarization-Programmes-imparted-to-Independent-Directors.pdf

DIRECTORS AND KEY MANAGERIAL PERSONNELS_

The Board of Directors of the Company comprises of Seven [7] directors of which one [1] is Executive Director; One [1] is Chairman & Managing Director & Five [5] are Non- Executive Independent Directors including one woman director as on March 31, 2024 who brings in a wide range of skills and experience to the Board.

? Retirement of Director by rotation

In accordance with the provisions of Section 152(6) of the Companies Act, 2013 and Articles of Association of the company, Mr. Kavish Jain, Executive Director of the Company liable to retire by rotation, has offered himself for re-appointment at the ensuing 19th Annual General Meeting of the Company. A resolution for his reappointment is being proposed at the 19th Annual General Meeting and his Profile is included in the Notice.

? Composition of the Board as on March 31, 2024

DIN	NAME OF DIRECTOR	CATEGORY OF DIRECTORS
02041164	Mr. Ashish Jain	Chairman & Managing Director
02041197	Mr. Kavish Jain	Executive Director
06964564	Mr. Amlendra Prasad Saxena	Non-Executive & Independent Director
09724549	Mr. Ajith Kumar Lakshmanan	Non-Executive & Independent Director
07653773	Mrs. Neelam Tater	Non-Executive & Independent Director
06593113	Mr. Pradip Kumar Das	Non-Executive & Independent Director
03498879	Mr. Chinnathambi Illango	Non-Executive & Independent Director

Based on the confirmations received, none of the Directors are disqualified from being appointed/re-appointed as a director in terms of Section 164 the Companies Act, 2013, a Certificate from M/s. Ronak Jhuthawat & Co., Practicing Company Secretaries regarding the Non-disqualification of Directors from being appointed/continue for the office of Director in your Company is placed as Annexure VI.

During the year following changes took place in the Board of Directors / KMP of Company:

NAME OF DIRECTORS/KMP	DESIGNATION	APPOINTMENT/ RESIGNATION	DATE OF CHANGE
Mr. Chinnathambi Illango	Non-Executive & Independent Director	Appointment	08.11.2023
Mr. Kalpesh Dave	Chief Executive Officer	Appointment	27.06.2023
Mr. Anoop Saxena	Chief Operating Officer	Appointment	27.06.2023
Mr. B.S. Kachhwaha	Chief Compliance Officer	Appointment	25.09.2023

? Declaration from Independent Directors on Annual Basis:

The Company has received necessary declaration from each Independent Director of the Company under Section 149(7) of the Companies Act, 2013 that he or she meets the criteria of his or her Independence as laid down in Section 149(6) and the provisions of Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

STOCK OPTION_

During the year Company has allotted 15,62,350 Equity Shares under the “Akme Employee Stock Option Plan 2021” to the eligible Employees of the Company on 26th June, 2023 & 08th November, 2023.

Further, the members of the Company have approved “Star Housing Finance Limited Employee Stock Option Scheme II 2023” in its Annual General Meeting held on 10th August, 2023 and the Company has received in-principle approval dated 4th October, 2023 from Bombay Stock Exchange for 77,00,000 Equity shares of Rs.5/- each to be issued under the same scheme.

FORMAL EVALUATION OF THE PERFORMANCE OF THE BOARD COMMITTEE OF THE BOARD AND INDIVIDUAL DIRECTOR_

Pursuant to the provisions of the Companies Act, 2013 and Regulation 17 and Part D of Schedule II to the Listing Regulations, the Board has carried out the annual performance evaluation of its own performance, the Directors individually as well as working of its Audit, Nomination and Remuneration, Stakeholders'' Relationship and Corporate Social Responsibility Committees. A structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering various aspects of the Board''s functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specified duties, obligations and governance.

The exercise was carried out to evaluate the performance of individual Directors, who were evaluated on parameters such as level of engagement and contribution, independence of judgement, safeguarding the interest of the Company, etc.

The Independent Directors of the Company met on February 19, 2024 without the presence of Non-Independent Directors and members of the management to review the performance of Non Independent Directors and the Board of Directors as a whole; to review the performance of the Chairman and Managing Director of the Company and to assess the quality, quantity and timeliness of flow of information between the management and the Board of Directors. The performance evaluation of the Independent Directors was carried out by the entire Board.

NUMBER OF THE MEETINGS OF THE BOARD_

The Board met Thirteen (13) times during the year under review. The details of the number of meetings of the Board held during the Financial Year 2023-24 and the attendance therein forms part of the Report on Corporate Governance which forms part of the Annual Report.

'' COMMITTEES OF THE BOARD_

The Board of Directors has the following Committees:

a) Audit Committee

b) Nomination and Remuneration Committee

c) Stakeholders'' Relationship Committee

d) Corporate Social Responsibility Committee

e) Risk Management Committee

The details of the required Committees of the Board along with their composition, number of meetings and attendance at the meetings are provided in the Report on Corporate Governance as required under Schedule V of the Listing Regulations.

? Shareholder''s Meeting

During the financial year ended March 31, 2024, 3 (Three) General Meetings were held. Further, details of the meetings are given in the Corporate Governance Report, which forms part of the Annual Report.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTY TRANSACTIONS_

In accordance with the provisions of Section 188 of the Act and rules made thereunder and Considering the nature of the industry in which the Company operates, all the transactions entered with related parties are in the ordinary course of business and on an arm''s length basis, the details with respect to the related party transactions are mentioned in the notes to the audited financial statements.

During the financial year under review, the company has not entered into material contract, arrangement or transaction with related party, as defined under Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Related Party Transaction Policy of the Company. The Related Party Transactions Policy and Procedures, as amended from time to time, as reviewed by the Audit Committee and approved by Board of Directors is uploaded on the website of the Company at https://www.starhfl.com/wp-content/uploads/2024/02/Policy-on-dealing-with-Related-Partv-Transactions.pdf

Form AOC-2 pursuant to clause (h) of sub-section (3) of Section 134 of the Companies Act, 2013 and Rule 8(2) of the Companies (Accounts) Rules, 2014 is annexed as “Annexure I” to this Report and forms a part of it.

PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE_

As per the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, your Company has in place a Policy on Prevention Prohibition & Redressal of Sexual Harassment of Women at Workplace and has a robust mechanism to redress the complaints reported thereunder.

Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

Pursuant to the provisions of Section 22 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the complaints received thereunder and the details relating thereto are as follows:

(a) Number of complaints at the beginning of the year: Nil

(b) Number of complaints received during the year: Nil

(c) Number of complaints disposed of during the year: Nil

(d) Number of complaints pending at the end of the year: Nil

Your Company on a regular basis sensitises its employees on prevention of sexual harassment through various workshops, awareness programmes. It may be mentioned here that the Company has Zero tolerance towards any action on the part of any executive / staff which may fall under the ambit of ‘Sexual Harassment'' at workplace, and is fully committed to uphold and maintain the dignity of every women working in the Company.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATOR OR COURT OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY’S OPERATIONS IN FUTURE_

During the year there has been no such significant and material order passed by the regulators or courts or tribunals impacting the going concern status and company''s operations in future.

LISTING FEES

Your Company has paid requisite annual listing fees to Bombay Stock Exchange (BSE) where it''s equity shares are listed. CHANGE IN NATURE OF BUSINESS

There has been no change in the nature of business of the Company during the year under review.

MAINTENANCE OF COST RECORDS

The Company being a Housing finance Company is not required to maintain cost records as prescribed under section 148(1) of the Companies Act, 2013.

SECRETARIAL STANDARDS

During the year under review, the Company has complied with the applicable secretarial standards issued by the Institute of Company Secretaries of India.

AUDITORS AND AUDITORS’ REPORT_

1. Statutory Auditors

M/S Nyati Mundra & Co., Chartered Accountants (Firm Registration No. 008153C) were appointed as Statutory Auditors of the Company for a period of 5 (five) consecutive years, at the Annual General Meeting of Members held on September 29, 2021 on a remuneration mutually agreed upon by the Board of Directors and the Statutory Auditors. They have confirmed their eligibility and qualifications required under the Act for holding office as Statutory Auditors of the Company.

The Statutory Auditor''s Report forms part of the Annual Report. There is no audit qualification, reservation or adverse remark for the year under review. There was no instance of fraud during the year under review, which required the Statutory Auditors to report to the Audit Committee and/ or Board under Section 143(12) of Act and Rules framed thereunder.

The Statutory Auditors have also submitted a separate Auditor''s Report on Regulatory compliance to the Board to comply with the requirement under chapter XII of the Master Directions. The copy of the Auditor Report is annexed herewith.

2. Secretarial Auditor

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 and Pursuant to Reg. 24A of Securities Exchange Board of India (Listing Obligation & Disclosure Requirement) (Amendments) Regulations, 2018, the Board of Directors of the Company appointed M/s Ronak Jhuthawat & Co., Practicing Company Secretaries, Udaipur, to undertake the Secretarial Audit of the Company for the financial year 2023-24. The Secretarial Audit Report & Annual secretarial Compliance Report for the financial year ended March 31, 2024, is annexed as “Annexure II” and “Annexure III “ forms an integral part of this Report.

The said report, does not contain any qualification, reservation or adverse remark, and thus do not call for any further comments.

INTERNAL AUDIT & INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY_

3. Internal auditor

Your Company has adequate internal control procedures commensurate with its size and nature of business. Your Company has clearly laid down policies, guidelines, and procedures that form a part of the internal control systems. The adequacy of the internal control systems encompasses the Company''s business processes and financial reporting systems and is examined by the management as well as by its internal auditors at regular intervals.

The internal auditors conduct audits at regular intervals to identify the weaknesses and suggest improvements for better functioning. The observations and recommendations of the internal auditors are discussed by the Audit Committee to ensure timely and corrective action.

Your Company has appointed M/s. KVU & Associates, Chartered Accountants as an Internal Auditor of the Company, who reports to the Audit Committee and to the Board of Directors of the Company. The Internal Auditor conducts comprehensive audit of functional areas and operations of the Company to examine the adequacy of and compliance with policies, procedures, statutory and regulatory requirements. Significant audit observations and follow up actions thereon are reported to the Audit Committee. The Audit Committee reviews adequacy and effectiveness of the Company''s internal control environment and monitors the implementation of audit recommendations.

The audit function maintains its independence and objectivity while carrying out assignments. It evaluates on a continuous basis, the adequacy and effectiveness of internal control mechanism. The function also proactively recommends improvement in policies and processes, suggests streamlining of controls against various risks.

Your Company has laid down set of standards, processes and structure, which enables it to implement internal financial control across the Company and ensure that the same are adequate and operating effectively.

REPORTING OF FRAUDS BY AUDITORS_

During the year under review, neither the Statutory Auditors nor the Secretarial Auditor has reported to the Audit Committee under Section 143(12) of the Act any instance of fraud committed against the Company by its officers or employees.

DIRECTORS’ RESPONSIBILITY STATEMENT_

As required under Section 134(5) of the Act, for the financial year ended on March 31, 2024, the Directors hereby confirm that:

? In the preparation of the annual financial statements for the year ended March 31, 2024, the applicable accounting standards read with the requirements set out under Schedule III to the Act have been followed and there were no material departures from the same;

? The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company and of the profit of the Company for the year ended on that date;

? The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

? The Directors have prepared the annual accounts on a going concern basis;

? The Directors have laid down internal financial controls to be followed by the Company and that the financial controls were adequate and were operating effectively;

? The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and were adequate and operating effectively.

REPORT ON CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION_

The Company has taken adequate steps to adhere to all the stipulations laid down in the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Chapter IX (Corporate Governance) of Master Directions Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021 and the Companies Act, 2013 and Rules thereto, as amended from time to time.

Pursuant to the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, RBI Directions and disclosures as required under The Companies Act, 2013 and the Rules thereto, a separate Section titled ‘Report on Corporate Governance'' forms part of this Annual Report as Annexure IV.

The certificate issued by Mr. Ronak Jhuthawat & Co. complies with the conditions of Corporate Governance as stipulated in the SEBI (LODR) Regulations, 2015 & forms part of this report as Annexure V.

The said certificate for financial year 2023-24 does not contain any qualification, reservation or adverse remarks.

In terms of Section 136 of The Companies Act, 2013, the reports and accounts are being sent to the members and others entitled thereto.

MANGEMENT DISCUSSION AND ANALYSIS REPORT_

Pursuant to Regulation 34 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, Management''s Discussion and Analysis Report, for the year under review, is presented in as separate section forming part of this Annual Report.

ANNUAL RETURN_

Pursuant to section 92(3) read with Section 134(3)(a) of the Act, the Annual Return is available on the Company''s website and can be accessed under the annual return tab at https://www.starhfl.com/disclosure-under-regulation-46-of-sebi-lodr-2015/

ENHANCING SHAREHOLDERS VALUE_

Your Company believes that its Members are among its most important stakeholders. Accordingly, your Company''s operations are committed to the pursuit of achieving high levels of operating performance and cost competitiveness, consolidating and building for growth, enhancing the productive asset and resource base and nurturing overall corporate reputation. Your Company is also committed to creating value for its other stakeholders by ensuring that its corporate actions positively impact the socio-economic and environmental dimensions and contribute to sustainable growth and development.

OUTLOOK_

? Focus on growth of Individual home loans segment.

? Making online loan application more effective and enhance its contribution towards the incremental business.

? Strengthening marketing offices opened during the last 3 years and making them high growth centers.

? To grow business qualitatively by consolidating position and strengthening the competitiveness on service delivery.

? Understanding the inherent risks to the business and managing it effectively.

? Widespread market studies assisting modelling of loan products to suit customer needs.

? Making use of information provided by marketing offices about ground market conditions.

INSOLVENCY AND BANKRUPTCY_

The Company has not made any application or no proceeding is pending under the Insolvency and Bankruptcy Code, 2016 during the Financial Year and hence not being commented upon.

THE DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF.

During the Financial Year under review, there has been no incident of one time settlement for loan taken from the banks of financial institutions and hence not being commented upon.

ACKNOWLEDGEMENTS_

Your Board of Directors take this opportunity to express their appreciation to all stakeholders of the Company including the Reserve Bank of India, National Housing Bank, the Ministry of Corporate Affairs, Securities and Exchange Board of India, the Government of India, Stock Exchanges and other Regulatory Authorities, Bankers, Lenders, Financial Institutions, Members, Credit Rating agencies, Customers of the Company for their continued support and trust. Your directors would like to express deep appreciation for the commitment shown by the employees in supporting the Company in achieving continued robust performance on all fronts.

In closing, we would like to thank all the investors as well as the communities we operate in who have reposed their trust in us and supported us in our journey.

---

Mar 31, 2018

The directors are pleased to present the Annual Report of your Company along with the audited accounts for the year ended March 31, 2018. The Management Discussion and Analysis has also been incorporated into this report.

KEY FINANCIALS

The Board''s Report shall be prepared based on the stand alone financial statements of the company. The Company''s financial performance for the financial year ended March 31st, 2018, is summarized below: -

PARTICULAR	RS. IN LACS
	2017-18	2016-17
Gross Income	705.82	340.40
Less : Finance Cost	170.89	47.42
Overhead	131.3	77.90
Depreciation	3.60	4.66
Profit Before Tax	400.04	210.40
Less : Provision for taxation	110.54	69.67
Profit After tax	289.50	140.73
Balance Brought Forward from last year	297.75	199.09
Appropriations	289.50	140.72
Transferred to Statutory Reserve under Section 36(1)(viii) of the Income Tax Act, 1961 read with Section 29C of National Housing Bank Act, 1987	80.01	42.08
Transferred to general reserve	Nil	Nil
Balance Carried over to the Balance Sheet	507.24	297.75

Transfer to Reserves

During the year under review, your Company transferred NIL to the General Reserve during the year under review and Rs. 80.01 Lacs to the Statutory Reserve under Section 36(1) (viii) of the Income Tax Act, 1961 read with Section 29C of National Housing Bank (NHB) Act, 1987 out of the amount available for appropriation and an amount of Rs. 289.50 Lacs is proposed to be retained in the Profit and Loss Account.

HIGHLIGHTS OF PERFORMANCE

Following are the key factors indicating the performance of the Company :

(Rs. In Lacs)

KEY FACTORS	2017-18	2016-17	GROWTH (%)
Gross Income	705.82	340.04	107.57%
Net Profit	289.50	140.73	105.71%
Portfolio	4915.55	2027.33	142.46%
(Outstanding Housing Loan/Other Loan)
EPS (Basic)	2.43	1.19	104.20%
CRAR(%)	67.02%	109.00%	-

DIVIDEND

To look after the further expansion of business activity and inadequacy of profits your directors do not recommend any payment of dividend for the year ended 31st March, 2018.

ALTERATION IN CAPITAL

- Authorized Share Capital

During the year under review the authorized share capital of the Company was increased from Rs. 12,00,00,000 (divided into 1,20,00,000 Equity Shares of Rs. 10/- each) to Rs. 14,00,00,000 (divided into 1,40,00,000 Equity shares of Rs. 10/each) vide Extraordinary General Meeting of the members of the Company held on 16th October, 2017.

- Share Warrants

Pursuant to SEBI (ICDR) Regulation, 2009 the members of the Company approved the Issue of Warrants to the prospective investors vide Extraordinary General Meeting dated 16th October, 2017 ath price of Rs. 84/- calculated in accordance with prescribed guidelines .

After obtaining the necessary approvals from BSE, the Board vide its meeting dated 30 th November, 2017 alloted 4,35,000 warrants to the promoters and non promoters on preferential basis at Rs. 84/- on receipt of amount equivalent to 25% of the Issue Price i.e. Rs. 91,35,000/- out of which 2,10,000 warrants allotted to non promoters were further converted into equity shares vide Board Meeting dated 09th January, 2018 in accordance with SEBI (ICDR) Regulations, 20009 and prescribed provisions of Companies Act, 2013 on receipt of the balance amount of 75% amount of the issue price. Thus at the end of the year there are 2,25,000 outstanding warrants issued to promoters.

And Accordingly, the aggregate paid up capital of the Company is Rs. 12,07,90,000/- divided into 1,20,79,000 equity shares of Rs. 10/- each as on 31.03.2018.

MIGRATION TO MAIN BOARD

In respect of postal ballot exercise as approved by members of the Company on 25.05.2017 for migration to Main Board, the trading approval was received from the BSE for migration of equity shares of the Company from BSE SME Platform to BSE Main board platform w.e.f 30.06.2017.

EVENTS SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS

Mr. Ashish Jain (DIN:02041164) has been designated as Chairman & Managing Director of the Company w.e.f 01st June 2018 for a tenure not exceeding Five Years subject to the approval of Shareholders by way of Special Resolution Cessation of Dr. Mohan Lal Nagda from the post of Chairman & Managing Director of the Company w.e.f. 19th May, 2018 as per prescribed provisions of Companies Act, 2013 due to his sudden demise.

DETAILS RELATING TO DEPOSITS

The Company has been granted registration by the National Housing Bank, New Delhi as a non deposit taking Housing Finance Company. Being so, the Company has neither accepted in the past nor has any future plans to accept any public deposits, by whatever name called.

INVESTOR COMPLAINTS AND COMPLIANCE

During the year under review the Company did not receive any investor complaints and that as on the date no complaints are pending. And also the Company has timely submitted all the reports relating to Investor Complaints pursuant to SEBI (LODR) Regulations, 2015 to BSE.

NON-PERFORMING ASSETS AND PROVISIONS FOR CONTINGENCY:

Your Company adhered to the prudential guidelines for Non performing Assets (NPAs), issued by the National Housing Bank (NHB) under its Directions of 2010, as amended from time to time. As per the prudential norms, the income on such NPAs is not to be recognized if unrealized. As per the prudential norms prescribed by the NHB, the Company has made provision for contingencies on standard as well as non-performing housing loans and property loans. The details of NPA have been given in financial Statements.

RESOURCE MOBILISATION

Your Company''s borrowing policy is under the control of the Board. The Company has vide special resolution passed by means of special Resolution on September, 10th, 2014, under Section 180(1)(c) of the Companies Act, 2013, authorized the Board of Directors to borrow money upon such terms and conditions as the Board may think fit in excess of aggregate of paid up share capital and free reserves of the Company up to an amount of Rs. 50 crore and the total amount so borrowed shall be within the limits as prescribed under the Housing Finance Companies (NHB) Directions, 2010.

Since the business of company is growing the requirement of funds arose and to meet that the Board proposed to members to increase the borrowing limit of the Company and accordingly seeks approval at the ensuing meeting scheduled to be held on 28th July, 2018 for increasing the Borrowing Limits under Section 180(1)(c) in excess of aggregate of paid up share capital and free reserves including securities premium of the Company up to an amount of Rs. 200 crore. Your Company continued to use a variety of funding sources to optimize funding costs, protect interest margins and maintain a diverse funding portfolio which further strengthened its funding stability and liquidity needs. Your Company continued to keep tight control over the cost of borrowings through negotiations with lenders and thus, raised resources at competitive rates from its lenders while ensuring proper asset liability match.

BANK BORROWINGS

During the financial year 2017-18 your Company raised Rs. 15 Cr. through term loan from State Bank of India & Rs. 8.00 Crores through AU Small Finance Bank Limited in the form of Term loan and Cash Credit Facility for meeting the working capital requirements. Presently Company is in line up with more proposals with banks and Financial Institutions for meeting the working capital requirement of the company in FY 2018-19.

The Outstanding Bank Borrowing as on 31.03.2018 stood at Rs 2955.64 Lacs.

RATING

The company has been assigned BBB- by SMERA Ratings Limited for the facility obtained from the Bank as on 13.03.2018.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013, apart from the loans made, guarantee given or security provided by the Company in the ordinary course of business are given in the Notes to accounts forming part of the Audited Financial Statements for the year ended March 31, 2018.

CAPITAL ADEQUACY

As required under National Housing Bank Directions, your Company is presently required to maintain a minimum capital adequacy of 12% on a standalone basis. In addition, the National Housing Bank Directions also require that your Company transfers minimum 20% of its annual profits to a reserve fund.

Your Company''s Capital Adequacy Ratio is at 67.02 % as at March 31, 2018, which provides an adequate cushion to withstand business risks and is above the minimum requirement of 12% stipulated by the National Housing Bank.

SUBSIDIARY, JOINT VENTURES AND ASSOCIATE COMPANIES

The Company does not have any subsidiary Company or Joint Company or Associate Company.

HUMAN RESOURCES AND TRAINING

Your Company has experienced promoters and a team whom your Company relies upon to capitalize on emerging new business opportunities. Your Company believes that a combination of its reputation in the market, its working environment and competitive compensation programs allows it to attract and retain best talent. Your Company strives to attract the best talent in the industry and ensures its employees'' development and their contribution to the Company''s success.

Your Company''s vision is to become an employer of choice by providing a compelling employee value proposition. Your Company has molded its policies relating to hiring, deployment, transfers, promotion, training, including its performance-linked bonuses and employee stock options, with the clear aim of building a ''cadre-based organization, whose cadre understands the company''s customers, their problems, issues and aspirations. Your Company''s human resources policies and practices are focused on recruiting and training employees who can empathies and deal with potential and existing borrowers.

PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 read with Rule, 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, there are no employees of the Company covered under this section who is earning salary over and above specified limit.

DISCLOSURE UNDER SUB-SECTION (3) OF SECTION 134 OF COMPANIES ACT, 2013, READ WITH RULE 8(3) OF THE COMPANIES (ACCOUNTS) RULES, 2014

The details of conservation of energy, technology absorption, foreign exchange earnings and outgo are as follows:

A. Conservation of energy:

The Company does not fall under any of the industries covered by the Companies (Disclosure of particulars of Directors) Rules, 1988.

B. Technology absorption:

The Company is not involved in any technology absorption nor is there any R&D activity during the year

C. Foreign Exchange Earnings and Outgo

Your company does not have any foreign exchange earning and outgo during the year under review.

INSURANCE

Your Company has insured its various properties and facilities against the risk of fire, theft and other perils, etc. and has also obtained Directors'' and Officers'' Liability Insurance Policy, which covers the Company''s Directors and Officers (employees in managerial or supervisory position) against the risk of financial loss including the expenses pertaining to defense cost and legal representation expenses arising in the normal course of business.

NATIONAL HOUSING BANK (NHB) GUIDELINES

The Company has complied with the provisions of the Housing Finance Companies (NHB) Directions, 2010 as prescribed by NHB and has been in compliance with the various Circulars, Notifications and Guidelines issued by National Housing Bank (NHB) from time to time. The Circulars and the Notifications issued by NHB are also placed before the Audit Committee / Board at regular intervals to update Committee / Board members on the same.

BSE COMPLIANCES

The Company has submitted various returns and reports as required quarterly/half yearly/ yearly in accordance with the prescribed guidelines.

RISK MANAGEMENT FRAMEWORK

ASHFL''S risk management is a discipline that forms the core of the Company and encompasses all the activities that affect the Company''s risk profile. As a housing finance institution, your Company is exposed to various risks like credit risk, market risk (interest rate and currency risk), liquidity risk and operational risk (technology, employee, transaction and reputation risk).

The Risk Management Committee (RMC) of the Company comprises of members of its senior management team, who have many years of experience in the industry and have put in place preventive mechanisms to contain various risks. The RMC met multiple times during the year ending 31 March, 2018 and to identify, measure, monitor and control various risks the Company was exposed to. The RMC put in place or enhanced the control measures to contain these risks.

The Company has a robust mechanism to ensure an ongoing review of systems, policies, processes and procedures to contain and mitigate risk that arise from time to time. ASHFL''S goal is to build a business that is stable, scalable and sustainable. In seeking to do this, the Company recognizes the importance and has in place a well-defined risk management framework that permeates all aspects of its business and, to which, every employee is sensitized.

ASSET LIABILITY MANAGEMENT COMMITTEE (ALCO)

The Asset Liability Management Committee (ALCO) lays down policies and quantitative limits that involve assessment of various types of risks and shifts in assets and liabilities to manage such risks. ALCO ensures that the liquidity and interest-rate risks are contained within the limits laid down by the Board. The Company has duly implemented the NHB''s Asset Liability Management Guidelines.

VIGIL MECHANISM

Pursuant to the provisions of Section 177 (9) & (10) of the Companies Act, 2013 read with Rule 7 of Companies (Meetings of Board and its Powers) Rules, 2014 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has in place a Whistle Blower Policy, which provides for a vigil mechanism that encourages and supports its Directors and employees to report instances of illegal activities, unethical behavior, actual or suspected, fraud or violation of the Company''s Code of Conduct or Ethics Policy. It also provides for adequate safeguards against victimization of persons who use this mechanism and direct access to the Chairman of the Audit Committee in exceptional cases.

CODES AND STANDARDS

Your Company has formulated various policies and codes in compliance with provisions of Directions and Guidelines issued by the National Housing Bank, Companies Act, 2013, Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and to ensure high ethical standards in the overall functioning of the organization. The said policies and codes are periodically reviewed by the Board of Directors.

The key policies and codes as approved by the Board of Directors and the respective compliance there under are detailed herein below:

- Know Your Customer & Anti Money Laundering Measure Policy

Your Company has a Board approved Know Your Customer & Anti Money Laundering Measure Policy (KYC & AML Policy) in place and adheres to the said Policy. The said Policy is in line with the National Housing Bank guidelines.

The Company has also adhered to the compliance requirement in terms of the said policy relating to the monitoring and reporting of cash / suspicious transactions. The Company furnishes to Financial Intelligence Unit (FIU), India, in the electronic medium, information of all cash transactions of the value of more than Rupees ten lakh or its equivalent in foreign currency and suspicious transactions whether or not made in cash, in terms of the said Policy.

- Fair Practice Code

Your Company has in place a Fair Practice Code (FPC), which includes guidelines on appropriate staff conduct when dealing with the customers and on the organization''s policies vis-a-vis client protection. The FPC captures the spirit of the National Housing Bank guidelines on fair practices for Housing Finance Companies.

During the year under review, FPC was modified by the Board and the grievance redressal mechanism within the Company was further strengthened.

- Policy on Disclosure of material events and information

During the year under review, your Company has adopted the Policy on Disclosure of Material Events and Information, in accordance with Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 to determine the events and information which are material in nature and are required to be disclosed to the Stock Exchanges.

- Code of Conduct for Board Members and the senior management

Your Company has in place Code of Conduct for the Board of Directors and the Senior Management Personnel to set forth the guiding principles on which the Company and its Board and Senior Management Personnel shall operate and conduct themselves with multitudinous stakeholders, government and regulatory agencies, media and anyone else with whom it is connected. A declaration by Chief Executive Officer, with regard to the Compliance with the said code, forms part of this Annual Report.

- Code for Prevention of Insider Trading Practices

Your Company has formulated and adopted a Code for Prevention of Insider Trading Practices in accordance with the model code of conduct as prescribed under the SEBI (Prohibition of Insider Trading) Regulations, 2015, as amended. The code lays down guidelines, which includes procedures to be followed and disclosures to be made while dealing in the shares of the Company.

The code is applicable to the promoters, directors, senior designated employees and their dependents and the said persons are restricted from dealing in the securities of the Company during the ''restricted trading periods'' notified by the Company, from time to time.

- Code of Business Ethics (COBE)

Your Company has adopted a Code of Business Ethics (COBE) which lays down the principles and standards that govern the activities of the Company and its employees to ensure and promote ethical behavior within the legal framework of the organization.

- Sexual Harassment Policy

Your Company has in place a Policy on Prevention, Prohibition & Redressal of Sexual Harassment of Women at Workplace and an Internal Complaints Committee (ICC) has been constituted there under. The Policy''s primary objective is to protect the women employees from sexual harassment at the place of work and also provides for punishment in case of false and malicious representations. During the year no complaints were received in this regard.

- Comprehensive Risk Management Policy

Your Company is committed to manage its risk in a proactive manner and has adopted a structured and disciplined approach to risk management by developing and implementing risk management framework. With a view to manage its risk effectively your Company has in place a Comprehensive Risk Management Policy which covers a formalized Risk Management Structure, along with other aspects of risk management i.e. credit risk management, operational risk management, market risk management and enterprise risk management. The Risk Management Committee of the Board, on periodic basis, oversees the risk management systems, processes and minimization procedures of the Company.

- Corporate Social Responsibility (CSR) Policy

Your Company has voluntarily framed Corporate Social Responsibility Policy (CSR Policy), as per the provisions of the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended, which, inter-alia, lays down the guidelines and mechanism for undertaking socially useful projects for welfare and sustainable development of the community at large. As per the provisions of Section 135 of the Companies Act, 2013, the Company has constituted a Corporate Social Responsibility Committee. The Committee assists the Board in fulfilling its duty towards the community and society at large by identifying the activities and programmes that can be undertaken by the Company, in terms of the Company''s CSR Policy. The composition of the CSR Committee and its terms of reference are given in the Corporate Governance Report forming part of this Annual Report.

- Remuneration Policy

The Board of Directors had on the recommendation of the Nomination & Remuneration Committee Appointed Mrs. Rajni Gehlot, Independent Director as chairperson, Mr. Amrit Singh Rajpurohit and Mrs. Rekha Jain, Independent Director as Member.

The Company follow a Policy on remuneration of Directors and senior management Employees, The Policy is approved by the Nomination & Remuneration Committee and the Board and is marked as Annexure-I

- Related Party Transactions Policy

Your Company has in place Related Party Transaction Policy, intended to ensure requisite approval, reporting and disclosure of transactions between the Company and its related parties. The said policy also defines the materiality of related party transactions and lays down the procedures of dealing with related party transactions.

During the year under review, the Related Party Transaction Policy was amended to align the same with the requirements of Companies (Amendment) Act, 2015 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

- Familiarisation Programme for Independent Directors:

The objective of a familiarization programme is to ensure that the non-executive directors are updated on the business environment and overall operations of the Company. This enables the non executive directors to make better informed decisions in the interest of the company and its stakeholders.

LISTING OF SHARES OF THE COMPANY

Your Company''s equity shares continue to remain listed on BSE Limited. Your Company has paid the listing fees as payable to the BSE Limited for the financial year 2017-18 on time.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

- Changes in the Director

During the year following changes took place in the board of Directors:

Sr. No.	Name of the Director	Designation	Appointment/ Resignation	Date of change
1	Rekha Jain	Independent Director	Appointment	29.07.2017
2	Ashish Jain	Executive Director	Appointment	29.07.2017
3	Avinash Bhatnagar	Independent Director	Resignation	08.08.2017
4	Ashish Jain	CFO	Resignation	08.08.2017
5	Bhanwar Si ngh Kachhawaha	CFO	Appointment	08.08.2017
6	Dr. Mohan Lal Nagda	Chairman & Managing Director	Cessation	19.05.2018
7	Ashish Jain	Chairman & Managing Director	Appointment as Managing Director	28.05.2018

Based on the confirmations received, none of the Directors are disqualified for being appointed/re-appointed as directors in terms of Section 164 the Companies Act, 2013.

- Cessation of Dr. Mohan Lal Nagda as Chairman & Managing Director:

Dr. Mohan Lal Nagda, Chairman & Managing Director of the of the Company passed away on 19th May, 2018. The Board considered invaluable contributions made by Dr. Mohan Lal Nagda as a Chairman & Managing Director of the Company during his tenure of 11 years.

- Appointment of Mr. Ashish Jain as Chairman & Managing Director:

On recommendation of Nomination and Remuneration Committee in the meeting held on 16th May, 2018, the Board has appointed Mr. Ashish Jain (DIN: 02041164) as Chairman & Managing Director w.e.f. 1st June, 2018 for the term of 5 years subject to the approval of members at the ensuing Annual General Meeting. Necessary resolution is being proposed in the notice of the ensuing Annual General Meeting for appointment of Mr. Ashish Jain as Chairman & Managing Director on Board of the Company in accordance with Companies Act, 2013 and Article of Association of the Company who shall hold office for a term of five consecutive years with effect from this Annual General Meeting and whose period of office will not be liable to determination by retirement of directors by rotation.

- Declaration from Independent directors on Annual basis:

The Company has received necessary declaration from each Independent Director of the Company Under Section 149(7) of the Companies Act, 2013 that the Independent Directors of the Company meet with the criteria of their Independence as laid down in Section 149(6) and the provisions of Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Based on the confirmations received, none of the Directors are disqualified for being appointed/re-appointed as directors in terms of Section 164 the Companies Act, 2013.

- Retirement of Director by rotation:

In accordance with the provisions of Section 152 of the Companies Act, 2013 and Articles of Association, Mr. Nirmal Kumar Jain, Director of your Company being the longest in office among Directors who are liable to retire by rotation, retires by rotation and being eligible; offers himself for reappointment at the ensuing Annual General Meeting.

- Stock Option:

During the year under review, no stock options were issued to the Directors of the Company.

PERFORMANCE EVALUATION

The provisions of the Companies Act, 2013 mandates formal annual evaluation of the Board of Directors, its committees and individual Directors. Schedule IV of the Companies Act, 2013 also requires the performance evaluation of Chairman & Managing Director and Non Executive Directors and Board as a whole to be carried out at a separate meeting by the Company''s Independent Directors. It also states that performance evaluation of Independent Directors shall be done by the entire Board excluding the Director being evaluated. The provisions of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, also require that the Board shall monitor and review the Board Evaluation Framework. The annual performance evaluation of the Board as a whole, all Directors as well as the evaluation of the Board Committees including Audit Committee, Nomination & Remuneration Committee, Risk Management Committee, Stakeholders'' Relationship Committee, and Corporate Social Responsibility Committee of the Board of Directors of the Company, was carried out.

MEETINGS

- Board

Your Company holds at least four Board meetings in a year, one in each quarter, inter-alia, to review the financial results and also holds additional Board Meetings to address its specific requirements, as and when required. All the decisions and urgent matters approved by way of circular resolutions are placed and numbered and noted at the subsequent Board meeting. Annual calendar of meetings of the Board are finalized well before the beginning of the financial year after seeking concurrence of all the Directors.

During the financial year 2017-18, eleven (11) Board Meetings were convened and held. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and the Securities and Exchange Board of India (Listing Obligation and Disclosure Requirements) Regulations, 2015. The details of the Board composition, its meetings held during the year along with the attendance of the respective Directors thereat are set out in the Corporate Governance Report forming part of this Annual Report.

The Extra Ordinary General Meeting of the Company was held on 16th October, 2017 during the year, the details of the Meeting has been disclosed in Corporate Governance report.

The Company''s Independent Directors meet at least once in every financial year without the presence of Executive Directors or management personnel. The Independent Directors of the Company met once during the year on March 24th, 2018 to review the performance of Non-Independent Directors and the Board as a whole, review the performance of the Chairperson of the Company and access the quality, quantity and timeliness of flow of information between the company management and the Board.

- Audit Committee & Other Board Committees

Your Company has a duly constituted Audit Committee as per the provisions of Section 177 of Companies Act, 2013 and provisions of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The Board of Directors has constituted four other committees namely - Nomination and Remuneration Committee, Stakeholders'' Relationship Committee, Risk Management Committee, and Corporate Social Responsibility Committee which enables the Board to deal with specific areas / activities that need a closer review and to have an appropriate structure to assist in the discharge of their responsibilities.

The Audit Committee and other Board Committees meet at regular intervals and ensure to perform the duties and functions as entrusted upon them by the Board.

The details of the Audit Committee and other Board Committees are also set out in the Corporate Governance Report forming part of this Annual Report.

RELATED PARTY TRANSACTIONS

There were no materially significant related party transactions i.e. transactions of material nature, with its promoters, directors or senior management or their relatives etc., that may have potential conflict with the interest of company at large. Transactions entered with related parties, as defined under the Companies Act, 2013 and provisions of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 during the financial year 2017-18 were mainly in the ordinary course of business and on an arm''s length basis.

Prior approval of the Audit Committee is obtained by the Company before entering into any related party transaction as per the applicable provisions of Companies Act, 2013 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. As per the provisions of Section 188 of the Companies Act, 2013, approval of the Board of Directors is also obtained for entering into related party transactions by the Company. A quarterly update is also given to the Audit committee and the Board of Directors on the Related Party Transactions undertaken by the Company for their review and consideration.

During the year, your Company has not entered into any material contract, arrangement or transaction with related parties, as defined under Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Related Party Transaction Policy of the Company. The details with respect to the related party transactions are mentioned in the notes to the audited financial statements.

Details of RPT in Form AOC-2 attached to Board report may also be referred to and marked as Annexure-II

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATOR OR COURT OR TRIBUNALS

During the year no significant or material order was passed by the Regulators or Courts or Tribunals and the Company has complied with the order and Compliances of Companies act 2013.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

Your Company has appointed T.R. Dangi & Associates, Chartered Accountant Udaipur as an Internal Auditor of the Company, who reports to the Audit Committee and to the Board of Directors of the Company. The Internal Auditor conducts comprehensive audit of functional areas and operations of the Company to examine the adequacy of and compliance with policies, procedures, statutory and regulatory requirements. Significant audit observations and follow up actions thereon are reported to the Audit Committee. The Audit Committee reviews adequacy and effectiveness of the Company''s internal control environment and monitors the implementation of audit recommendations.

The audit function maintains its independence and objectivity while carrying out assignments. It evaluates on a continuous basis, the adequacy and effectiveness of internal control mechanism. The function also proactively recommends improvement in policies and processes, suggests streamlining of controls against various risks.

Your Company has laid down set of standards, processes and structure, which enables it to implement internal financial control across the Company and ensure that the same are adequate and operating effectively.

SECRETARIAL AUDITOR & SECRETARIAL AUDIT REPORT -

Secretarial Auditor

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed Mr. Ronak Jhuthawat Proprietor of M/s Ronak Jhuthawat & Co., Practicing Company Secretaries, Udaipur, to undertake the Secretarial Audit of the Company for the financial year 2017-18. The Secretarial Audit Report for the financial year ended March 31, 2018, is annexed as "Annexure - III" to this report. The said report, does not contain any qualification, reservation or adverse remark, however, contains certain observations of the Secretarial Auditor which are self explanatory, and thus do not call for any further comments.

- Qualifications in Secretarial Audit Reports:

There are no qualifications, reservations or adverse remarks or disclaimer made by the company secretary in practice in his secretarial audit report.

- Statutory Auditors

At the Eleventh (11th) Annual General Meeting held on September 24th, 2016, the Members had appointed M/S. H.R. Jain & Co., Chartered Accountants, (FRN 000262C), as the Statutory Auditors of the Company, by way of ordinary resolution under section 139 of the Companies Act, 2013, to hold office from the conclusion of this Annual General Meeting until the conclusion of the Annual General Meeting of the Company to be held in the year 2021 of the Company.

The Company has received consent from the Statutory Auditors and confirmation to the effect that they are not disqualified to be appointed as the joint Statutory Auditors of the Company in terms of the provisions of Companies Act, 2013 and Rules framed there under.

- Notes to Accounts and Auditors Report

The notes to the accounts referred to in Auditors Report are self-explanatory and do not call for any further comments. The Statutory Auditors Report does not contain any qualification, reservation or adverse remark.

- Qualifications in Audit Reports:

There are no qualifications, reservations or adverse remarks or disclaimer made by the statutory auditor in his report.

DIRECTORS'' RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013:

- that in the preparation of the annual financial statements for the year ended March 31, 2018, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

- that such accounting policies as mentioned in Note of the Notes to the Financial Statements have been selected and applied consistently and judgment and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2018 and of the profit of the Company for the year ended on that date;

- that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

- that the annual financial statements have been prepared on a going concern basis;

- that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively;

- that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

REPORT ON CORPORATE GOVERNANCE

Pursuant to Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section titled ''Report on Corporate Governance'' forms part of this Annual Report.

The Report on Corporate Governance also includes certain disclosures that are required, as per Companies Act, 2013. The certificate by the Statutory Auditors confirming Compliance with the conditions of Corporate Governance as stipulated in Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed as Annexure IV'' to this report. The said certificate for financial year 2017-18 does not contain any qualification, reservation or adverse remark.

In terms of Section 136 of the Act, the Reports and Accounts are being sent to the members and others entitled thereto.

MANGEMENT DISCUSSION AND ANALYSIS

Pursuant to Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section titled ''Report on Corporate Governance'' forms part of this Annual Report.

EXTRACT OF ANNUAL RETURN

Pursuant to Section 134(3)(a) and Section 92(3) of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014,the extract of the Annual Return as at March 31, 2018, in the prescribed form MGT 9, forms part of this report and is annexed as ''Annexure V ".

ENHANCING SHAREHOLDERS VALUE

Your Company believes that its Members are among its most important stakeholders. Accordingly, your Company''s operations are committed to the pursuit of achieving high levels of operating performance and cost competitiveness, consolidating and building for growth, enhancing the productive asset and resource base and nurturing overall corporate reputation. Your Company is also committed to creating value for its other stakeholders by ensuring that its corporate actions positively impact the socio-economic and environmental dimensions and contribute to sustainable growth and development.

OUTLOOK

During the year, Indian economy continued to consolidate the gains achieved through macroeconomic stability. The country remained on a stable growth path on the back of sharp reduction in crude oil prices and resilient domestic consumption. Besides, inflation remained under control and fiscal and current account deficits continued to be moderate. As all key business enablers are currently showing favorable signs, your Company is positive and expects another year of healthy growth in 2018-19.

ACKNOWLEDGEMENTS

Your Directors wish to place on record their gratitude to the National Housing Bank, Securities and Exchange Board of India, Ministry of Corporate Affairs, Registrar of Companies, Financial Intelligence Unit (India), the Company''s Customers, Bankers and other Lenders, Members, and others for their continued support and faith reposed in the Company. The Board also places on record its deep appreciation for the dedication and commitment of the employees at all levels as their hard work, co-operation and support had enabled the Company to maintain its consistent growth. The Directors would also like to thank the BSE Limited, , National Securities Depository Limited, Central Depository Services (India) Limited and the Credit Rating Agencies for their continued co-operation.

CAUTIONARY STATEMENT

Statements in the Board''s Report and the Management Discussion & Analysis describing the Company''s objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Company''s operations include global and domestic demand and supply conditions affecting selling prices of finished goods, input availability and prices, changes in government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.

Registered office For, and on behalf of the Board

AKME Business Center (ABC)

4-5 Subcity Center Savina Circle Sd/- Sd/-

Opp. Krishi Upaz Mandi Udaipur.313002 Ashish Jain Nirmal Kumar Jain

Date : 16.06.2018 Managing Director Director

DIN 02041164 DIN 00240441

---

Mar 31, 2017

To

The Members

Akme Star Housing Finance Limited Udaipur

The Directors take pleasure in presenting the 12th Annual Report together with the audited financial statements for the year ended March 31, 2017. The Management Discussion and Analysis has also been incorporated into this report.

KEY FINANCIALS

The Board''s Report shall be prepared based on the stand alone financial statements of the company. The Company''s financial performance for the financial year ended March 31, 2017, is summarized below :-

Rs. In Lacs

Particular	2016-17	2015-16
Gross Income	340.40	272.35
Less : Finance Cost	47.42	30.01
Overhead	77.92	68.77
Depreciation	4.66	4.64
Profit Before Tax	210.39	168.92
Less : Provision for taxation	69.67	53.40
Profit After tax	140.73	115.52
Balance Brought Forward from last year	199.09	117.35
Appropriations	140.72	115.52
Transferred to Statutory Reserve under Section 36(1 )(viii) of the Income Tax Act, 1961 read with Section 29C of National Housing Bank Act, 1987	42.08	33.78
Transferred to general reserve	Nil	Nil
Balance Carried over to the Balance Sheet	297.75	199.09

Transfer to Reserves

During the year under review, your Company transferred NIL to the General Reserve during the year under review and Rs. 42.08 Lacs to the Statutory Reserve under Section 36(1) (viii) of the Income Tax Act, 1961 read with Section 29C of National Housing Bank (NHB) Act, 1987 out of the amount available for appropriation and an amount of 140.72 Lacs is proposed to be retained in the Profit and Loss Account.

HIGHLIGHTS OF PERFORMANCE

Following are the key factors indicating the performance of the Company:

Rs. In Lacs

KEY FACTORS	2016-17	2015-16	GROWTH (%)
Gross Income	340.40	272.35	24.85
Net Profit	140.73	115.52	21.81
Outstanding Housing Loan/Other Loan	2027.32	1551.25	30.69%
EPS	1.19	0.97	22.68%
CRAR (%)	109.00%	114.35%	--

DIVIDEND

To look after the further expansion of business activity and inadequacy of profits, directors do not recommend any payment of dividend for the year ended 31st March, 2017.

ALTERATION IN CAPITAL

- AUTHORIZED SHARE CAPITAL

During the year under review the authorized share capital of the Company was increased from Rs. 6.00,00,000 (divided into 60, 00,000 Equity Shares of '' 10/- each) to Rs. 12,00,00,000 (divided into 1,20,00,000 Equity shares of Rs. 10/- each) vide Extraordinary General Meeting of the members of the Company held on 21st February, 2017.

- BONUS SHARE ISSUED

During the year, 59,34,500 fully paid up equity shares of 10/- each were issued as bonus shares in the ratio 1:1. The existing permissible reserves of the Company was capitalized for issue of bonus shares in the proportion of one equity share for every one equity share held by the equity shareholders of the Company.

MIGRATION TO MAIN BOARD

Company has got listed its Equity shares (Company Scrip Code: 539017) on BSE SME Platform on March 20, 2015, and admitted to dealings on the Exchange in the list of ''MT'' Group Securities. Further two years have been elapsed since the listing of Equity Shares and thus Company is now eligible to migrate on Main Board of BSE and accordingly the Board proposed the migration vide Board Meeting dated 31st March, 2017 for which the shareholders approval was duly taken via offering Postal Ballot facility and E Voting facility that was passed with requisite majority.

EVENTS SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS

The Company got in principle approval for migration to the Bombay Stock Exchange Main Board vide letter dated 15.06.2017.

DETAILS RELATING TO DEPOSITS

The Company has been granted registration by the National Housing Bank, New Delhi as a non deposit taking Housing Finance Company. Being so, the Company has neither accepted in the past nor has any future plans to accept any public deposits, by whatever name called.

INVESTOR COMPLAINTS AND COMPLIANCE

During the year under review the Company did not receive any investor complaints and that as on the date no complaints are pending.

And also the Company has timely submitted all the reports relating to Investor Complaints pursuant to SEBI (LODR) Regulations, 2015 to BsE.

NON-PERFORMING ASSETS AND PROVISIONS FOR CONTINGENCY:

Your Company adhered to the prudential guidelines for Non performing Assets (NPAs), issued by the National Housing Bank (NHB) under its Directions of 2010, as amended from time to time. As per the prudential norms, the income on such NPAs is not to be recognized if unrealized. As per the prudential norms prescribed by the NHB, the Company has made provision for contingencies on standard as well as non-performing housing loans and property loans. The details of NPA have been given in financial Statements.

RESOURCE MOBILISATION

Your Company''s borrowing policy is under the control of the Board. The Company has vide special resolution passed by means of special Resolution on September, 10th, 2014, under Section 180(1)(c) of the Companies Act, 2013, authorized the Board of Directors to borrow money upon such terms and conditions as the Board may think fit in excess of aggregate of paid up share capital and free reserves of the Company up to an amount of Rs. 50 crore and the total amount so borrowed shall be within the limits as prescribed under the Housing Finance Companies (NHB) Directions, 2010.

Your Company continued to use a variety of funding sources to optimize funding costs, protect interest margins and maintain a diverse funding portfolio which further strengthened its funding stability and liquidity needs. Your Company continued to keep tight control over the cost of borrowings through negotiations with lenders and thus, raised resources at competitive rates from its lenders while ensuring proper asset liability match.

BANK BORROWINGS

During the financial year 2016-17 your Company raised Rs.7.36 through term loans from bank of Baroda for meeting the working capital requirements. Presently Company is in line up with more proposal with banks and Financial Institutions for meeting the working capital requirement of the company in FY 2017-18.

The Outstanding Bank Borrowing as on 31.03.2017 stood at Rs 5.86 Crore

RATING

The Company has been awarded by SMERA BB STABLE outlook for the Borrowings from the bank by the Company for the FY 2015-16.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013, apart from the loans made, guarantee given or security provided by the Company in the ordinary course of business are given in the Notes to accounts forming part of the Audited Financial Statements for the year ended March 31, 2017.

CAPITAL ADEQUACY

As required under National Housing Bank Directions, your Company is presently required to maintain a minimum capital adequacy of 12% on a standalone basis. In addition, the National Housing Bank Directions also require that your Company transfers minimum 20% of its annual profits to a reserve fund.

Your Company''s Capital Adequacy Ratio is at 109.00 % as at March 31, 2017, which provides an adequate cushion to withstand business risks and is above the minimum requirement of 12% stipulated by the National Housing Bank.

SUBSIDIARY, JOINT VENTURES AND ASSOCIATE COMPANIES

The Company does not have any subsidiary Company or Joint Company or Associate Company.

HUMAN RESOURCES AND TRAINING

Your Company has experienced promoters and a team whom your Company relies upon to capitalize on emerging new business opportunities. Your Company believes that a combination of its reputation in the market, its working environment and competitive compensation programs allows it to attract and retain best talent. Your Company strives to attract the best talent in the industry and ensures its employees'' development and their contribution to the Company''s success.

Your Company''s vision is to become an employer of choice by providing a compelling employee value proposition. Your Company has molded its policies relating to hiring, deployment, transfers, promotion, training, including its performance-linked bonuses and employee stock options, with the clear aim of building a ‘cadre-based organization, whose cadre understands the company''s customers, their problems, issues and aspirations. Your Company''s human resources policies and practices are focused on recruiting and training employees who can empathies and deal with potential and existing borrowers..

PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 read with Rule, 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, there are no employees of the Company covered under this section who is earning salary over and above specified limit.

DISCLOSURE UNDER SUB-SECTION (3) OF SECTION 134 OF COMPANIES ACT, 2013, READ WITH RULE 8(3) OF THE COMPANIES (ACCOUNTS) RULES, 2014

The details of conservation of energy, technology absorption, foreign exchange earnings and outgo are as follows:

Conservation of energy:

The Company does not fall under any of the industries covered by the Companies (Disclosure of particulars of Directors) Rules, 1988.

Technology absorption:

The Company is not involved in any technology absorption nor is there any R&D activity during the year

Foreign Exchange Earnings and Outgo

Your company does not have any foreign exchange earning and outgo during the year under review.

INSURANCE

Your Company has insured its various properties and facilities against the risk of fire, theft and other perils, etc. and has also obtained Directors'' and Officers'' Liability Insurance Policy, which covers the Company''s Directors and Officers (employees in managerial or supervisory position) against the risk of financial loss including the expenses pertaining to defense cost and legal representation expenses arising in the normal course of business.

NATIONAL HOUSING BANK (NHB) GUIDELINES

The Company has complied with the provisions of the Housing Finance Companies (NHB) Directions, 2010 as prescribed by NHB and has been in compliance with the various Circulars, Notifications and Guidelines issued by National Housing Bank (NHB) from time to time. The Circulars and the Notifications issued by NHB are also placed before the Audit Committee / Board at regular intervals to update Committee / Board members on the same.

RISK MANAGEMENT FRAMEWORK

ASHFL''S risk management is a discipline that forms the core of the Company and encompasses all the activities that affect the Company''s risk profile. As a housing finance institution, your Company is exposed to various risks like credit risk, market risk (interest rate and currency risk), liquidity risk and operational risk (technology, employee, transaction and reputation risk).

The Risk Management Committee (RMC) of the Company comprises of members of its senior management team, who have many years of experience in the industry and have put in place preventive mechanisms to contain various risks. The RMC met multiple times during the year ending 31 March, 2017 and to identify, measure, monitor and control various risks the Company was exposed to. The RMC put in place or enhanced the control measures to contain these risks.

The Company has a robust mechanism to ensure an ongoing review of systems, policies, processes and procedures to contain and mitigate risk that arise from time to time. ASHFL''S goal is to build a business that is stable, scalable and sustainable. In seeking to do this, the Company recognizes the importance and has in place a well-defined risk management framework that permeates all aspects of its business and, to which, every employee is sensitized.

ASSET LIABILITY MANAGEMENT COMMITTEE (ALCO)

The Asset Liability Management Committee (ALCO) lays down policies and quantitative limits that involve assessment of various types of risks and shifts in assets and liabilities to manage such risks. ALCO ensures that the liquidity and interest-rate risks are contained within the limits laid down by the Board. The Company has duly implemented the NHB''s Asset Liability Management Guidelines.

- VIGIL MECHANISM

Pursuant to the provisions of Section 177 (9) & (10) of the Companies Act, 2013 read with Rule 7 of Companies (Meetings of Board and its Powers) Rules, 2014 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has in place a Whistle Blower Policy, which provides for a vigil mechanism that encourages and supports its Directors and employees to report instances of illegal activities, unethical behavior, actual or suspected, fraud or violation of the Company''s Code of Conduct or Ethics Policy. It also provides for adequate safeguards against victimization of persons who use this mechanism and direct access to the Chairman of the Audit Committee in exceptional cases.

CODES AND STANDARDS

Your Company has formulated various policies and codes in compliance with provisions of Directions and Guidelines issued by the National Housing Bank, Companies Act, 2013, Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and to ensure high ethical standards in the overall functioning of the organization. The said policies and codes are periodically reviewed by the Board of Directors.

The key policies and codes as approved by the Board of Directors and the respective compliance there under are detailed herein below:

- KNOW YOUR CUSTOMER & ANTI MONEY LAUNDERING MEASURE POLICY

Your Company has a Board approved Know Your Customer & Anti Money Laundering Measure Policy (KYC & AML Policy) in place and adheres to the said Policy. The said Policy is in line with the National Housing Bank guidelines.

The Company has also adhered to the compliance requirement in terms of the said policy relating to the monitoring and reporting of cash / suspicious transactions. The Company furnishes to Financial Intelligence Unit (FIU), India, in the electronic medium, information of all cash transactions of the value of more than Rupees ten lakh or its equivalent in foreign currency and suspicious transactions whether or not made in cash, in terms of the said Policy.

- FAIR PRACTICE CODE

Your Company has in place a Fair Practice Code (FPC), which includes guidelines on appropriate staff conduct when dealing with the customers and on the organization''s policies vis-a-vis client protection. The FPC captures the spirit of the National Housing Bank guidelines on fair practices for Housing Finance Companies.

During the year under review, FPC was modified by the Board and the grievance redressal mechanism within the Company was further strengthened.

- POLICY ON DISCLOSURE OF MATERIAL EVENTS AND INFORMATION

During the year under review, your Company has adopted the Policy on Disclosure of Material Events and Information, in accordance with Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 to determine the events and information which are material in nature and are required to be disclosed to the Stock Exchanges.

- CODE OF CONDUCT FOR BOARD MEMBERS AND THE SENIOR MANAGEMENT

Your Company has in place Code of Conduct for the Board of Directors and the Senior Management Personnel to set forth the guiding principles on which the Company and its Board and Senior Management Personnel shall operate and conduct themselves with multitudinous stakeholders, government and regulatory agencies, media and anyone else with whom it is connected. A declaration by Chief Executive Officer, with regard to the Compliance with the said code, forms part of this Annual Report.

- CODE FOR PREVENTION OF INSIDER TRADING PRACTICES

Your Company has formulated and adopted a Code for Prevention of Insider Trading Practices in accordance with the model code of conduct as prescribed under the SEBI (Prohibition of Insider Trading) Regulations, 2015, as amended. The code lays down guidelines, which includes procedures to be followed and disclosures to be made while dealing in the shares of the Company.

The code is applicable to the promoters, directors, senior designated employees and their dependents and the said persons are restricted from dealing in the securities of the Company during the ‘restricted trading periods'' notified by the Company, from time to time.

- CODE OF BUSINESS ETHICS (COBE)

Your Company has adopted a Code of Business Ethics (COBE) which lays down the principles and standards that govern the activities of the Company and its employees to ensure and promote ethical behavior within the legal framework of the organization.

- SEXUAL HARASSMENT POLICY

Your Company has in place a Policy on Prevention, Prohibition & Redressal of Sexual Harassment of Women at Workplace and an Internal Complaints Committee (ICC) has been constituted there under. The Policy''s primary objective is to protect the women employees from sexual harassment at the place of work and also provides for punishment in case of false and malicious representations. During the year no complaints were received in this regard.

- COMPREHENSIVE RISK MANAGEMENT POLICY

Your Company is committed to manage its risk in a proactive manner and has adopted a structured and disciplined approach to risk management by developing and implementing risk management framework. With a view to manage its risk effectively your Company has in place a Comprehensive Risk Management Policy which covers a formalized Risk Management Structure, along with other aspects of risk management i.e. credit risk management, operational risk management, market risk management and enterprise risk management. The Risk Management Committee of the Board, on periodic basis, oversees the risk management systems, processes and minimization procedures of the Company.

- CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY

Your Company has framed Corporate Social Responsibility Policy (CSR Policy), as per the provisions of the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended, which, inter-alia, lays down the guidelines and mechanism for undertaking socially useful projects for welfare and sustainable development of the community at large. As per the provisions of Section 135 of the Companies Act, 2013, the Company has constituted a Corporate Social Responsibility Committee. The Committee assists the Board in fulfilling its duty towards the community and society at large by identifying the activities and programmes that can be undertaken by the Company, in terms of the Company''s CSR Policy. The composition of the CSR Committee and its terms of reference are given in the Corporate Governance Report forming part of this Annual Report.

- REMUNERATION POLICY

The Board of Directors had on the recommendation of the Nomination & Remuneration Committee Appointed Mr. Avinash Bhatnagar Independent Director as chairperson, Mr. Amrit Singh Rajpurohit and Mrs. Rajni Gehlot Independent Director as Member.

The Company follow a Policy on remuneration of Directors and senior management Employees, The Policy is approved by the Nomination & Remuneration Committee and the Board and is marked as Annexure-I

- RELATED PARTY TRANSACTIONS POLICY

Your Company has in place Related Party Transaction Policy, intended to ensure requisite approval, reporting and disclosure of transactions between the Company and its related parties. The said policy also defines the materiality of related party transactions and lays down the procedures of dealing with related party transactions.

During the year under review, the Related Party Transaction Policy was amended to align the same with the requirements of Companies (Amendment) Act, 2015 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

- FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS:

The objective of a familiarization programme is to ensure that the non-executive directors are updated on the business environment and overall operations of the Company. This enables the non executive directors to make better informed decisions in the interest of the company and its stakeholders.

LISTING OF SHARES OF THE COMPANY

Your Company''s equity shares continue to remain listed on BSE Limited. Your Company has paid the listing fees as payable to the BSE Limited for the financial year 2016-17 on time.

However Company has applied to Bombay Stock Exchange to migrate from SME platform to main Board Exchange and received in principle from the Bombay Stock Exchange vide their later dated 15.06.2017.

DIRECTORS AND KEY MANAGERIAL PERSONAL - Appointment of Director

On recommendation of Nomination and Remuneration Committee Mr. Ashish Jain (DIN: 00241164) C.F.O. of the company is proposed to be appointed as Executive Director Finance on Board of Directors of the Company. Necessary resolution is being proposed in the notice of the ensuing Annual General Meeting for appointment of Mr. Ashish Jain as Executive Director on Board of the Company in accordance with Companies Act, 2013 and Article of Association of the Company whose period of office will be liable to determination by retirement of directors by rotation.

Based on the confirmations received, none of the Directors are disqualified for being appointed/re-appointed as directors in terms of Section 164 the Companies Act, 2013.

- Appointment of Independent Directors

On recommendation of Nomination and Remuneration Committee Dr. Rekha Jain (DIN: 07703994) is proposed to be appointed as Independent Non Executive Director on Board of Directors of the Company. The Company has received a notice from a member under Section 160 of the Companies Act, 2013, along with a requisite deposit, proposing her candidature for the office of Independent Director, to be appointed as such, at the ensuing annual general meeting. Necessary resolution is being proposed in the notice of the ensuing Annual General Meeting for appointment of Dr. Rekha Jain as Independent Director on Board of the Company in accordance with Companies Act, 2013 and Article of Association of the Company who shall hold office for a term of five consecutive years with effect from this Annual General Meeting and whose period of office will not be liable to determination by retirement of directors by rotation.

All existing Independent Directors have given declarations that they meet the criteria of independence, as laid down under Section 149(6) of the Companies Act, 2013 and the provisions of Regulation 16(1 )(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Based on the confirmations received, none of the Directors are disqualified for being appointed/re-appointed as directors in terms of Section 164 the Companies Act, 2013.

- Retirement of Director by rotation

In accordance with the provisions of Section 152 of the Companies Act, 2013 and Articles of Association, Mr. Kalu Lal Jain, Director of your Company being the longest in office among Directors who is liable to retire by rotation, retires by rotation and being eligible; offers himself for reappointment at the ensuing Annual General Meeting.

- Stock Option

During the year under review, no stock options were issued to the Directors of the Company.

PERFORMANCE EVALUATION

The provisions of the Companies Act, 2013 mandates formal annual evaluation of the Board of Directors, its committees and individual Directors. Schedule IV of the Companies Act, 2013 also requires the performance evaluation of Chairman & Managing Director and Non Executive Directors and Board as a whole to be carried out at a separate meeting by the Company''s Independent Directors. It also states that performance evaluation of Independent Directors shall be done by the entire Board excluding the Director being evaluated. The provisions of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, also require that the Board shall monitor and review the Board Evaluation Framework. The annual performance evaluation of the Board as a whole, all Directors as well as the evaluation of the Board Committees including Audit Committee, Nomination & Remuneration Committee, Risk Management Committee, Stakeholders'' Relationship Committee, and Corporate Social Responsibility Committee of the Board of Directors of the Company, was carried out.

MEETINGS - BOARD

Your Company holds at least four Board meetings in a year, one in each quarter, inter-alia, to review the financial results and also holds additional Board Meetings to address its specific requirements, as and when required. All the decisions and urgent matters approved by way of circular resolutions are placed and numbered and noted at the subsequent Board meeting. Annual calendar of meetings of the Board are finalized well before the beginning of the financial year after seeking concurrence of all the Directors.

During the financial year 2016-17, eight (08) Board Meetings were convened and held. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and the Securities and Exchange Board of India (Listing Obligation and Disclosure Requirements) Regulations, 2015. The details of the Board composition, its meetings held during the year along with the attendance of the respective Directors thereat are set out in the Corporate Governance Report forming part of this Annual Report.

The Extra Ordinary General Meeting of the Company was held on 21st February, 2017 during the year , the details of the Meeting has been disclosed in Corporate Governance report.

The Company''s Independent Directors meet at least once in every financial year without the presence of Executive Directors or management personnel. The Independent Directors of the Company met once during the year on March 25th, 2017 to review the performance of Non-Independent Directors and the Board as a whole, review the performance of the Chairperson of the Company and access the quality, quantity and timeliness of flow of information between the company management and the Board.

- AUDIT COMMITTEE & OTHER BOARD COMMITTEES

Your Company has a duly constituted Audit Committee as per the provisions of Section 177 of Companies Act, 2013 and provisions of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The Board of Directors has constituted four other committees namely - Nomination and Remuneration Committee, Stakeholders'' Relationship Committee, Risk Management Committee, and Corporate Social Responsibility Committee which enables the Board to deal with specific areas / activities that need a closer review and to have an appropriate structure to assist in the discharge of their responsibilities.

The Audit Committee and other Board Committees meet at regular intervals and ensure to perform the duties and functions as entrusted upon them by the Board.

The details of the Audit Committee and other Board Committees are also set out in the Corporate Governance Report forming part of this Annual Report.

RELATED PARTY TRANSACTIONS

There were no materially significant related party transactions i.e. transactions of material nature, with its promoters, directors or senior management or their relatives etc., that may have potential conflict with the interest of company at large. Transactions entered with related parties, as defined under the Companies Act, 2013 and provisions of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 during the financial year 2016-17 were mainly in the ordinary course of business and on an arm''s length basis.

Prior approval of the Audit Committee is obtained by the Company before entering into any related party transaction as per the applicable provisions of Companies Act, 2013 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. As per the provisions of Section 188 of the Companies Act, 2013, approval of the Board of Directors is also obtained for entering into related party transactions by the Company. A quarterly update is also given to the Audit committee and the Board of Directors on the Related Party Transactions undertaken by the Company for their review and consideration.

During the year, your Company has not entered into any material contract, arrangement or transaction with related parties, as defined under Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Related Party Transaction Policy of the Company. The details with respect to the related party transactions are mentioned in the notes to the audited financial statements.

Details of RPT in Form AOC-2 attached to Board report may also be referred to and marked as Annexure-II

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATOR OR COURT OR TRIBUNALS

During the year the Company has filed petition with the Regional Director, Ahemdabad for condonation of delay in creation of charge, and the Regional Director has passed order for the same vide order dated 22.06.2016. Company has complied with the order and Compliances of Companies act 2013.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

Your Company has appointed TR Dangi & Associates Chartered Accountant Udaipur as an Internal Auditor of the Company, who reports to the Audit Committee and to the Board of Directors of the Company. The Internal Auditor conducts comprehensive audit of functional areas and operations of the Company to examine the adequacy of and compliance with policies, procedures, statutory and regulatory requirements. Significant audit observations and follow up actions thereon are reported to the Audit Committee. The Audit Committee reviews adequacy and effectiveness of the Company''s internal control environment and monitors the implementation of audit recommendations.

The audit function maintains its independence and objectivity while carrying out assignments. It evaluates on a continuous basis, the adequacy and effectiveness of internal control mechanism. The function also proactively recommends improvement in policies and processes, suggests streamlining of controls against various risks

Your Company has laid down set of standards, processes and structure, which enables it to implement internal financial control across the Company and ensure that the same are adequate and operating effectively.

SECRETARIAL AUDITOR & SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed Mr. Ronak Jhuthawat Proprietor of M/s Ronak Jhuthawat & Co., Practicing Company Secretaries, Udaipur, to undertake the Secretarial Audit of the Company for the financial year 2016-17. The Secretarial Audit Report for the financial year ended March 31, 2017, is annexed as “Annexure - III” to this report. The said report, does not contain any qualification, reservation or adverse remark, however, contains certain observations of the Secretarial Auditor which are self explanatory, and thus do not call for any further comments.

- Qualifications in Secretarial Audit Reports:

There are no qualifications, reservations or adverse remarks or disclaimer made—

(a) By the company secretary in practice in his secretarial audit report;

AUDITORS

- Statutory Auditors

At the Eleventh (11th) Annual General Meeting held on September 24th, 2016, the Members had appointed M/S.

H.R. Jain & Co., Chartered Accountants, (FRN 000262C), as the Statutory Auditors of the Company, by way of ordinary resolution under section 139 of the Companies Act, 2013, to hold office from the conclusion of this Annual General Meeting until the conclusion of the Annual General Meeting of the Company to be held in the year 2021 of the Company, subject to ratification of the appointment by the Members at every subsequent Annual General Meeting as per the provisions of the Companies Act, 2013.

Based on the recommendation of the Audit Committee, the Board of Directors , recommended the ratification of appointment M/S. H.R. Jain & Co., Chartered Accountants, (FRN 000262C), as the Statutory Auditors of the Company, and that, the necessary resolution in this respect is being included in the notice of the Twelfth (12th) Annual General Meeting for the approval of the Members of the Company. The Company has received consent from the Statutory Auditors and confirmation to the effect that they are not disqualified to be appointed as the Joint Statutory Auditors of the Company in terms of the provisions of Companies Act, 2013 and Rules framed there under.

- Notes to Accounts and Auditors Report

The notes to the accounts referred to in Auditors Report are self-explanatory and do not call for any further comments. The Statutory Auditors Report does not contain any qualification, reservation or adverse remark.

- Qualifications in Audit Reports:

There are no qualifications, reservations or adverse remarks or disclaimer made—

(a) By the statutory auditor in his report; and

DIRECTORS’ RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013: that in the preparation of the annual financial statements for the year ended March 31, 2017, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

that such accounting policies as mentioned in Note of the Notes to the Financial Statements have been selected and applied consistently and judgment and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2017 and of the profit of the Company for the year ended on that date;

that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

that the annual financial statements have been prepared on a going concern basis;

that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively;

that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

REPORT ON CORPORATE GOVERNANCE

Pursuant to Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section titled ‘Report on Corporate Governance'' forms part of this Annual Report.

The Report on Corporate Governance also includes certain disclosures that are required, as per Companies Act, 2013. The certificate by the Statutory Auditors confirming Compliance with the conditions of Corporate Governance as stipulated in Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed as ‘Annexure V'' to this report. The said certificate for financial year 2016-17 does not contain any qualification, reservation or adverse remark.

In terms of Section 136 of the Act, the Reports and Accounts are being sent to the members and others entitled thereto.

MANGEMENT DISCUSSION AND ANALYSIS

Pursuant to Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section titled ‘Report on Corporate Governance'' forms part of this Annual Report.

EXTRACT OF ANNUAL RETURN

Pursuant to Section 134(3)(a) and Section 92(3) of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014,the extract of the Annual Return as at March 31, 2017, in the prescribed form MGT 9, forms part of this report and is annexed as “Annexure IV”.

ENHANCING SHAREHOLDERS VALUE

Your Company believes that its Members are among its most important stakeholders. Accordingly, your Company''s operations are committed to the pursuit of achieving high levels of operating performance and cost competitiveness, consolidating and building for growth, enhancing the productive asset and resource base and nurturing overall corporate reputation. Your Company is also committed to creating value for its other stakeholders by ensuring that its corporate actions positively impact the socio-economic and environmental dimensions and contribute to sustainable growth and development.

OUTLOOK

During the year, Indian economy continued to consolidate the gains achieved through macroeconomic stability. The country remained on a stable growth path on the back of sharp reduction in crude oil prices and resilient domestic consumption. Besides, inflation remained under control and fiscal and current account deficits continued to be moderate.

As per Government estimates, the Indian economic growth is expected at 8.00% as against 7.1% based on the new formula the statistics department has started using to measure the economy. The GDP is expected to grow at 7.5%-8% in the backdrop of improving macro-economic conditions. CPI was lower on account of base effect on account of fall in prices in food, housing and clothing inflation. Based on the current global and domestic outlook this target is expected to be achieved and would pave way for the RBI to further cut the policy rates bringing down the interest rates in the economy

The lowering of the interest rates and revival of the economy is expected to give a lift to the housing finance market in 2017-18.

As all key business enablers are currently showing favorable signs, your Company is positive and expects another year of healthy growth in 2017-18.

ACKNOWLEDGEMENTS

Your Directors wish to place on record their gratitude to the National Housing Bank, Securities and Exchange Board of India, , Ministry of Corporate Affairs, Registrar of Companies, Financial Intelligence Unit (India), the Company''s Customers, Bankers and other Lenders, Members, and others for their continued support and faith reposed in the Company. The Board also places on record its deep appreciation for the dedication and commitment of the employees at all levels as their hard work, co-operation and support had enabled the Company to maintain its consistent growth. The Directors would also like to thank the BSE Limited, , National Securities Depository Limited, Central Depository Services (India) Limited and the Credit Rating Agencies for their continued co-operation.

CAUTIONARY STATEMENT

Statements in the Board''s Report and the Management Discussion & Analysis describing the Company''s objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Company''s operations include global and domestic demand and supply conditions affecting selling prices of finished goods, input availability and prices, changes in government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.

Registered office For, and on behalf of the Board

AKME Business Center (ABC)

4-5 Subcity Center Savina Circle

Opp. Krishi Upaz Mandi Udaipur.313002 Sd/- Sd/-

Date : 19.06.2017 Dr. Mohan Lal Nagda Nirmal Kumar Jain

(Managing Director) (Director)

DIN 00211925 DIN 00240441

---

Mar 31, 2016

Director’s Report

To

The Members

Akme Star Housing Finance Limited

Udaipur

The Directors take pleasure in presenting the 11th Annual Report together with the audited financial statements for the year ended March 31, 2016. The Management Discussion and Analysis has also been incorporated into this report.

KEY FINANCIALS :

The Board’s Report shall be prepared based on the stand alone financial statements of the company. The Company’s financial performance for the financial year ended March 31, 2016, is summarized below :-

Rs. In Lacs

Particular	2015-16	2014-15
Gross Income	272.35	201.83
Less : Finance Cost	30.01	36.72
Overhead	68.77	65.38
Depreciation	4.64	1.74
Profit Before Tax	168.93	97.99
Less : Provision for taxation	53.40	31.30
Profit After tax	115.52	66.69
Balance Brought Forward from last year	117.35	70.25
Amount available for appropriation	232.87	136.94
Appropriations
Transferred to Statutory Reserve under Section 36(1)(viii) of the Income Tax Act, 1961 read with Section 29C of National Housing Bank Act, 1987	33.78	19.59
Transferred to general reserve	Nil	Nil
Balance Carried over to the Balance Sheet	199.09	117.35
	232.87	136.94

Transfer to Reserves

During the year under review, your Company transferred NIL to the General Reserve during the year under review and 33.78 Lacs to the Statutory Reserve under Section 36(1) (viii) of the Income Tax Act, 1961 read with Section 29C of National Housing Bank (NHB) Act, 1987 out of the amount available for appropriation and an amount of 232.87 Lacs is proposed to be retained in the Profit and Loss Account.

HIGHLIGHTS OF PERFORMANCE

The Company has achieved a gross income and net profit of Rs. 272.35 Lacs and Rs. 115.52 Lacs during the year under review as compared to Rs. 201.83 Lacs and Rs. 66.69 Lacs in the previous year respectively.

The housing loans/other loan outstanding during the year ended 31st March, 2016 were of Rs. 1551.25 lacs as against Rs. 1232.20 lacs during the previous year.

The Net Owned Funds (NOF)/ Net worth of your Company worth Rs 1653.78 Lacs as on 31.03.2016 as against Rs 1538.25/- Lacs during the previous year.

The Earnings Per Share (EPS) is Rs. 1.95 as at March 31, 2016 as against Rs. 1.52 as at March 31, 2015. DIVIDEND

To look after the further expansion of business activity and inadequacy of profits your directors do not recommend any payment of dividend for the year ended 31st March, 2016.

SHARE CAPITAL Authorized Share Capital

During the year under review the authorized share capital of the Company stood at '' 6,00,00,000 (divided into 60,00,000 Equity Shares of '' 10/- each). No change was made in authorized Share Capital as compared to previous Year.

Issued and Paid-up Capital

Your Company’s Share Capital is Rs 59,345,000 (divided into 5934500 Equity shares of Rs. 10/- each) as at March 31, 2016 and no change was made in issued and Paid up capital as compared to previous year.

EVENTS SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS

There are no material changes and commitments affecting financial position of the Company between 31st March and the date of Board’s Report.

DETAILS RELATING TO DEPOSITS

The Company has been granted registration by the National Housing Bank, New Delhi as a non deposit taking Housing Finance Company. Being so, the Company has neither accepted in the past nor has any future plans to accept any public deposits, by whatever name called.

INVESTOR COMPLAINTS AND COMPLIANCE

During the year under review the Company did not receive any investor complaints and that as on the date no complaints are pending.

NON-PERFORMING ASSETS AND PROVISIONS FOR CONTINGENCY:

Your Company adhered to the prudential guidelines for Non performing Assets (NPAs), issued by the National Housing Bank (NHB) under its Directions of 2010, as amended from time to time. As per the prudential norms, the income on such NPAs is not to be recognized if unrealized. As per the prudential norms prescribed by the NHB, the Company has made provision for contingencies on standard as well as non-performing housing loans and property loans. The details of NPA have been given in financial Statements.

RESOURCE MOBILISATION

Your Company’s borrowing policy is under the control of the Board. The Company has vide special resolution on September, 10th, 2014, under Section 180(1)(c) of the Companies Act, 2013, authorized the Board of Directors to borrow money upon such terms and conditions as the Board may think fit in excess of aggregate of paid up share capital and free reserves of the Company up to an amount of Rs. 50 crore and the total amount so borrowed shall be within the limits as prescribed under the Housing Finance Companies (NHB) Directions, 2010.

Your Company continued to use a variety of funding sources to optimize funding costs, protect interest margins and maintain a diverse funding portfolio which further strengthened its funding stability and liquidity needs. Your Company continued to keep tight control over the cost of borrowings through negotiations with lenders and thus, raised resources at competitive rates from its lenders while ensuring proper asset liability match.

LOANS FROM BANKS

As part of its liability management, your Company endeavors to diversify the sources of its resource base in order to achieve an appropriate maturity structure and minimize the weighted average cost of borrowed funds. Your Company continued to leverage on its long term relationship with banks and thus tied up fund based working capital limit amounting to 3.00 Crore as at the end of financial year.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013, apart from the loans made, guarantee given or security provided by the Company in the ordinary course of business are given in the Notes to accounts forming part of the Audited Financial Statements for the year ended March 31, 2016.

CAPITAL ADEQUACY

As required under National Housing Bank Directions, your Company is presently required to maintain a minimum capital adequacy of 12% on a standalone basis. In addition, the National Housing Bank Directions also require that your Company transfers minimum 20% of its annual profits to a reserve fund.

Your Company’s Capital Adequacy Ratio is at 114.35 % as at March 31, 2016, which provides an adequate cushion to withstand business risks and is above the minimum requirement of 12% stipulated by the National Housing Bank.

SUBSIDIARY, JOINT VENTURES AND ASSOCIATE COMPANIES

The Company does not have any subsidiary Company or Joint Company or Associate Company.

HUMAN RESOURCES AND TRAINING

Your Company has experienced promoters and a team whom your Company relies upon to to capitalize on emerging new business opportunities. Your Company believes that a combination of its reputation in the market, its working environment and competitive compensation programs allows it to attract and retain best talent. Your Company strives to attract the best talent in the industry and ensures its employees’ development and their contribution to the Company’s success.

Your Company’s vision is to become an employer of choice by providing a compelling employee value proposition. Your Company has molded its policies relating to hiring, deployment, transfers, promotion, training, including its performance-linked bonuses with the clear aim of building a ‘cadre-based organization, whose cadre understands the company’s customers, their problems, issues and aspirations. Your Company’s human resources policies and practices are focused on recruiting and training employees who can empathies and deal with potential and existing borrowers..

PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 read with Rule, 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, there are no employees of the Company covered under this section who is earning salary over and above specified limit.

DISCLOSURE UNDER SUB-SECTION (3) OF SECTION 134 OF COMPANIES ACT, 2013, READ WITH RULE 8(3) OF THE COMPANIES (ACCOUNTS) RULES, 2014

The details of conservation of energy, technology absorption, foreign exchange earnings and outgo are as follows: Conservation of energy:

The Company does not fall under any of the industries covered by the Companies (Disclosure of particulars of Directors) Rules, 1988.

Technology absorption:

The Company is not involved in any technology absorption nor is there any R&D activity during the year

Foreign Exchange Earnings and Outgo

Your company does not have any foreign exchange earnings and outgo during the year under review.

INSURANCE

Your Company has insured its various properties and facilities against the risk of fire, theft and other perils, etc. and has also obtained Directors’ and Officers’ Liability Insurance Policy, which covers the Company’s Directors and Officers (employees in managerial or supervisory position) against the risk of financial loss including the expenses pertaining to defense cost and legal representation expenses arising in the normal course of business

NATIONAL HOUSING BANK (NHB) GUIDELINES

The Company has complied with the provisions of the Housing Finance Companies (NHB) Directions, 2010 as prescribed by NHB and has been in compliance with the various Circulars, Notifications and Guidelines issued by National Housing Bank (NHB) from time to time. The Circulars and the Notifications issued by NHB are also placed before the Audit Committee / Board at regular intervals to update Committee / Board members on the same.

RISK MANAGEMENT

As a housing finance company, your Company is exposed to various risks that are inherent in the lending business. The primary risks include credit risk, market risk, liquidity risk, legal risks, interest rate risk, compliance risk and operational risk. Your Company has invested in people, processes and technology to mitigate risks posed by internal and external environment. Your Company places emphasis on risk management measures to ensure an appropriate balance between risk and return. The Board also on regular intervals is updated on the risk management systems, processes and minimization procedures of the Company.

Pursuant to the requirement of the SEBI (LODR) Guideline, 2015, the Company has constituted a Business Risk Management Committee. The details of Committee and its terms of reference are set out in the Corporate Governance Report forming part of the Board’s Report. During the year, the Board reviewed the risks associated with the business of the Company, its root causes and the efficacy of the measures taken to mitigate the same. The procedures are adopted to assess the risks and their mitigation mechanisms.

ASSET LIABILITY MANAGEMENT COMMITTEE (ALCO)

The Asset Liability Management Committee (ALCO) lays down policies and quantitative limits that involve assessment of various types of risks and shifts in assets and liabilities to manage such risks. ALCO ensures that the liquidity and interest-rate risks are contained within the limits laid down by the Board. The Company has duly implemented the NHB’s Asset Liability Management Guidelines.

CODES AND POLICIES & COMPLIANCES THEREUNDER

Your Company has formulated various policies and codes in compliance with provisions of Directions and Guidelines issued by the National Housing Bank, Companies Act, 2013, Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and to ensure high ethical standards in the overall functioning of the organization. The said policies and codes are periodically reviewed by the Board of Directors.

The key policies and codes as approved by the Board of Directors and the respective compliance there under are detailed herein below:

KNOW YOUR CUSTOMER & ANTI MONEY LAUNDERING MEASURE POLICY

Your Company has a Board approved Know Your Customer & Anti Money Laundering Measure Policy (KYC & AML Policy) in place and adheres to the said Policy. The said Policy is in line with the National Housing Bank guidelines. The Company has also adhered to the compliance requirement in terms of the said policy relating to the monitoring and reporting of cash / suspicious transactions. The Company furnishes to Financial Intelligence Unit (FIU), India, in the electronic medium, information of all cash transactions of the value of more than Rupees ten lakh or its equivalent in foreign currency and suspicious transactions whether or not made in cash, in terms of the said Policy.

FAIR PRACTICE CODE

Your Company has in place a Fair Practice Code (FPC), which includes guidelines on appropriate staff conduct when dealing with the customers and on the organization’s policies vis-a-vis client protection. The FPC captures the spirit of the National Housing Bank guidelines on fair practices for Housing Finance Companies.

During the year under review, FPC was modified by the Board and the grievance redressal mechanism within the Company was further strengthened.

POLICY ON DISCLOSURE OF MATERIAL EVENTS AND INFORMATION

During the year under review, your Company has adopted the Policy on Disclosure of Material Events and Information, in accordance with Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations,

2015 to determine the events and information which are material in nature and are required to be disclosed to the Stock Exchanges.

CODE OF CONDUCT FOR BOARD MEMBERS AND THE SENIOR MANAGEMENT

Your Company has in place Code of Conduct for the Board of Directors and the Senior Management Personnel to set forth the guiding principles on which the Company and its Board and Senior Management Personnel shall operate and conduct themselves with multitudinous stakeholders, government and regulatory agencies, media and anyone else with whom it is connected. A declaration by Chief Executive Officer, with regard to the Compliance with the said code, forms part of this Annual Report.

CODE FOR PREVENTION OF INSIDER TRADING PRACTICES

Your Company has formulated and adopted a Code for Prevention of Insider Trading Practices in accordance with the model code of conduct as prescribed under the SEBI (Prohibition of Insider Trading) Regulations, 2015, as amended. The code lays down guidelines, which includes procedures to be followed and disclosures to be made while dealing in the shares of the Company.

The code is applicable to the promoters, directors, senior designated employees and their dependents and the said persons are restricted from dealing in the securities of the Company during the ‘restricted trading periods’ notified by the Company, from time to time.

CODE OF BUSINESS ETHICS (COBE)

Your Company has adopted a Code of Business Ethics (COBE) which lays down the principles and standards that govern the activities of the Company and its employees to ensure and promote ethical behavior within the legal framework of the organization.

WHISTLE BLOWER POLICY

Pursuant to the provisions of Section 177 (9) & (10) of the Companies Act, 2013 read with Rule 7 of Companies (Meetings of Board and its Powers) Rules, 2014 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has in place a Whistle Blower Policy, which provides for a vigil mechanism that encourages and supports its Directors and employees to report instances of illegal activities, unethical behavior, actual or suspected, fraud or violation of the Company’s Code of Conduct or Ethics Policy. It also provides for adequate safeguards against victimization of persons who use this mechanism and direct access to the Chairman of the Audit Committee in exceptional cases.

SEXUAL HARASSMENT POLICY

Your Company has in place a Policy on Prevention, Prohibition & Redressal of Sexual Harassment of Women at Workplace and an Internal Complaints Committee (ICC) has been constituted there under. The Policy’s primary objective is to protect the women employees from sexual harassment at the place of work and also provides for punishment in case of false and malicious representations. During the year no complaints were received in this regard.

COMPREHENSIVE RISK MANAGEMENT POLICY

Your Company is committed to manage its risk in a proactive manner and has adopted a structured and disciplined approach to risk management by developing and implementing risk management framework. With a view to manage its risk effectively your Company has in place a Comprehensive Risk Management Policy which covers a formalized Risk Management Structure, along with other aspects of risk management i.e. credit risk management, operational risk management, market risk management and enterprise risk management. The Risk Management Committee of the Board, on periodic basis, oversees the risk management systems, processes and minimization procedures of the Company

CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY

Your Company has framed Corporate Social Responsibility Policy (CSR Policy), as per the provisions of the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended, which, inter-alia, lays down the guidelines and mechanism for undertaking socially useful projects for welfare and sustainable development of the community at large. As per the provisions of Section 135 of the Companies Act, 2013, the Company has constituted a Corporate Social Responsibility Committee. The Committee assists the Board in fulfilling its duty towards the community and society at large by identifying the activities and programmes that can be undertaken by the Company, in terms of the Company’s CSR Policy. The composition of the CSR Committee and its terms of reference are given in the Corporate Governance Report forming part of this Annual Report.

However Company has adopting CSR Policy and constituted CSR Committee on voluntary basis.

REMUNERATION POLICY

The Board of Directors had on the recommendation of the Nomination & Remuneration Committee Appointed Mr. Avinash Bhatnagar Independent Director as chairman, Mr. Amrit Singh Rajpurohit and Mrs. Rajni Gehlot Independent Director as Member.

The Company follow a Policy on remuneration of Directors and senior management Employees, The Policy is approved by the Nomination & Remuneration Committee and the Board and is marked as Annexure-I

VIGIL MECHANISM

Fraud free and corruption free work culture has been core to the Company. on view of the potential risk of fraud and corruption due to rapid growth and geographical spread of operations, the company has put an even greater emphasis to address this risk.

The Audit Committee of the Company is also looking for prevent the fraud under the Vigil mechanism for the Company. RELATED PARTY TRANSACTIONS POLICY

Your Company has in place Related Party Transaction Policy, intended to ensure requisite approval, reporting and disclosure of transactions between the Company and its related parties. The said policy also defines the materiality of related party transactions and lays down the procedures of dealing with related party transactions.

During the year under review, the Related Party Transaction Policy was amended to align the same with the requirements of Companies (Amendment) Act, 2015 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS:

The objective of a familiarization programme is to ensure that the non-executive directors are updated on the business environment and overall operations of the Company. This enables the non executive directors to make better informed decisions in the interest of the company and its stakeholders.

LISTING OF SHARES OF THE COMPANY

Your Company’s equity shares continue to remain listed on BSE Limited. As per the requirements of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, which came in effect from December 1, 2015, a shortened version of the Uniform Listing Agreement was signed by the Company with BSE Limited. Your Company has paid the listing fees as payable to the BSE Limited for the financial year 2016-17 on time.

DIRECTORS AND KEY MANAGERIAL PERSONAL Appointment of Independent Directors

The Board appointed all the existing Independent Directors viz. Mr. Amrit Singh Rajpurohit and Mrs. Rajni Gehlot as Independent Director under Section 149 of the Companies Act 2013 for a term of Five Years from the 9th Annual general Meeting.

The Shareholder approves their appointment in Annual General Meeting held on 10th September 2014.

The Board appointed existing Independent Directors viz. Mr. Avinash Bhatnagar as Independent Director under Section 149 of the Companies Act 2013 for a term of Five Years from the 10th Annual general Meeting.

The Shareholder approved their appointment in Annual General Meeting held on 08th August, 2015

All Independent Directors have given declarations that they meet the criteria of independence, as laid down under Section 149(6) of the Companies Act, 2013 and the provisions of Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Based on the confirmations received, none of the Directors are disqualified for being appointed/re-appointed as directors in terms of Section 164 the Companies Act, 2013.

Declaration from Independent directors on Annual basis:

The Company has received necessary declaration from each Independent Director of the Company Under Section 149(7) of the Companies Act, 2013 that the Independent Directors of the Company meet with the criteria of their Independence as laid down in Section 149(6).

Retirement of Director by rotation

In accordance with the provisions of Section 152 of the Companies Act, 2013 and Articles of Association, Mr. Nirmal Kumar Jain, Director of your Company being the longest in office among Directors who are liable to retire by rotation, retires by rotation and being eligible; offers himself for reappointment at the ensuing Annual General Meeting.

Stock Option

During the year under review, no stock options were issued to the Directors of the Company.

BOARD EVALUATION PERFORMANCE EVALUATION

The provisions of the Companies Act, 2013 mandates formal annual evaluation of the Board of Directors, its committees and individual Directors. Schedule IV of the Companies Act, 2013 also requires the performance evaluation of Chairman

& Managing Director and Non Executive Directors and Board as a whole to be carried out at a separate meeting by the Company’s Independent Directors. It also states that performance evaluation of Independent Directors shall be done by the entire Board excluding the Director being evaluated. The provisions of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, also require that the Board shall monitor and review the Board Evaluation Framework. The annual performance evaluation of the Board as a whole, all Directors as well as the evaluation of the Board Committees including Audit Committee, Nomination & Remuneration Committee, Risk Management Committee, Stakeholders’ Relationship Committee, and Corporate Social Responsibility Committee of the Board of Directors of the Company, was carried out.

MEETINGS

Your Company holds at least four Board meetings in a year, one in each quarter, inter-alia, to review the financial results of the Company. The Company also holds additional Board Meetings to address its specific requirements, as and when required. All the decisions and urgent matters approved by way of circular resolutions are placed and numbered and noted at the subsequent Board meeting. Annual calendar of meetings of the Board are finalized well before the beginning of the financial year after seeking concurrence of all the Directors.

During the financial year 2015-16, six (6) Board Meetings were convened and held. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and the Securities and Exchange Board of India (Listing Obligation and Disclosure Requirements) Regulations, 2015. The details of the Board composition, its meetings held during the year along with the attendance of the respective Directors thereat are set out in the Corporate Governance Report forming part of this Annual Report.

The Company’s Independent Directors meet at least once in every financial year without the presence of Executive Directors or management personnel. The Independent Directors of the Company met once during the year on March 15th,

2016 to review the performance of Non-Independent Directors and the Board as a whole, review the performance of the Chairperson of the Company and access the quality, quantity and timeliness of flow of information between the company management and the Board.

BOARD COMMITTEES

Your Company has a duly constituted Audit Committee as per the provisions of Section 177 of Companies Act, 2013 and provisions of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The Board of Directors has constituted four other committees namely - Nomination and Remuneration Committee, Stakeholders’ Relationship Committee, Risk Management Committee, and Corporate Social Responsibility Committee which enables the Board to deal with specific areas / activities that need a closer review and to have an appropriate structure to assist in the discharge of their responsibilities.

The Audit Committee and other Board Committees meet at regular intervals and ensure to perform the duties and functions as entrusted upon them by the Board.

The details of the Audit Committee and other Board Committees are also set out in the Corporate Governance Report forming part of this Annual Report.

RELATED PARTY TRANSACTIONS

There were no materially significant related party transactions i.e. transactions of material nature, with its promoters, directors or senior management or their relatives etc., that may have potential conflict with the interest of company at large. Transactions entered with related parties, as defined under the Companies Act, 2013 and provisions of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 during the financial year 2015-16 were mainly in the ordinary course of business and on an arm’s length basis.

Details of RPT in Form AOC-2 attached to Board report may also be referred to and marked as Anexure-II

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATOR OR COURT OR TRIBUNALS

The Company has been following directions, guidelines, circulars issued by SEBI, BSE, MCA, NHB etc. from time to time relating to listed companies and that the regulations of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 are now applicable to the listed companies w.e.f. December, 2015

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

Your Company has appointed a Chartered Accountant as an Internal Auditor of the Company, who reports to the Audit Committee and to the Board of Directors of the Company. The Internal Auditor conducts comprehensive audit of functional areas and operations of the Company to examine the adequacy of and compliance with policies, procedures, statutory and regulatory requirements. Significant audit observations and follow up actions thereon are reported to the Audit Committee. The Audit Committee reviews adequacy and effectiveness of the Company’s internal control environment and monitors the implementation of audit recommendations.

The audit function maintains its independence and objectivity while carrying out assignments. It evaluates on a continuous basis, the adequacy and effectiveness of internal control mechanism. The function also proactively recommends improvement in policies and processes, suggests streamlining of controls against various risks

Your Company has laid down set of standards, processes and structure, which enables it to implement internal financial control across the Company and ensure that the same are adequate and operating effectively.

SECRETARIAL AUDITOR & SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed Mr. Ronak Jhuthawat Proprietress of M/s Ronak Jhuthawat & Co., Practicing Company Secretaries, Udaipur, to undertake the Secretarial Audit of the Company for the financial year 2015-16. The Secretarial Audit Report for the financial year ended March 31, 2016, is annexed as “Annexure - III” to this report. The said report, does not contain any qualification, reservation or adverse remark, however, contains certain observations of the Secretarial Auditor which are self explanatory, and thus do not call for any further comments.

AUDITORS Statutory Auditors

M/s. Nyati Mundra & Co. (FRN 008153C) Chartered Accountants, the Statutory Auditors have not offered themselves to continue as Statutory Auditors of the Company in view of their pre-occupation with other work. The Board places on record its appreciation for the services rendered by them during their tenure with the Company.

Based on the recommendation of the Audit Committee, the Board of Directors, have appointed M/s. H.R. Jain & Co. (FRN 000262C) as the Statutory Auditors of the Company, subject to the approval by the Members of the Company in the Company’s ensuing annual general meeting. M/s. H.R. Jain & Co. shall hold office for the first term of five years, from the conclusion of the 11th Annual General Meeting until the conclusion of the 16th Annual General Meeting of the Company (subject to ratification of their appointment by the Members at every subsequent Annual General Meeting). The proposal for their appointment as Statutory Auditors of the Company is included in the Notice of the ensuing annual general meeting for approval of the Members of the Company. M/s. H.R. Jain & Co. has furnished written consent and a confirmation to the effect that they are not disqualified to be appointed as the Statutory Auditors of the Company in terms of the provisions of Companies Act, 2013 and Rules framed there under. In terms of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, they have confirmed that they hold a valid certificate issued by the Peer Review Board of the ICAI.

Notes to Accounts and Auditors Report

The notes to the accounts referred to in Auditors Report are self-explanatory and do not call for any further comments. The Statutory Auditors Report does not contain any qualification, reservation or adverse remark.

QUALIFICATIONS IN AUDIT REPORTS:

There are no qualifications, reservations or adverse remarks or disclaimer made—

(a) By the statutory auditor in his report; and

(b) By the company secretary in practice in his secretarial audit report;

DIRECTORS’ RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013:

i) that in the preparation of the annual financial statements for the year ended March 31, 2016, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii) that such accounting policies as mentioned in Note of the Notes to the Financial Statements have been selected and applied consistently and judgment and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2016 and of the profit of the Company for the year ended on that date;

iii) that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) that the annual financial statements have been prepared on a going concern basis;

x) that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively;

vi) that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

REPORT ON CORPORATE GOVERNANCE

Pursuant to Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section titled ‘Report on Corporate Governance’ forms part of this Annual Report.

The Report on Corporate Governance also includes certain disclosures that are required, as per Companies Act, 2013. The certificate by the Statutory Auditors confirming Compliance with the conditions of Corporate Governance as stipulated in Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed as ‘Annexure V’ to this report. The said certificate for financial year 2015-16 does not contain any qualification, reservation or adverse remark.

In terms of Section 136 of the Act, the Reports and Accounts are being sent to the members and others entitled thereto.

EXTRACT OF ANNUAL RETURN

Pursuant to Section 134(3)(a) and Section 92(3) of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the extract of the Annual Return as at March 31, 2016, in the prescribed form MGT 9, forms part of this report and is annexed as “Annexure IV”.

ENHANCING SHAREHOLDERS VALUE

Your Company believes that its Members are among its most important stakeholders. Accordingly, your Company’s operations are committed to the pursuit of achieving high levels of operating performance and cost competitiveness, consolidating and building for growth, enhancing the productive asset and resource base and nurturing overall corporate reputation. Your Company is also committed to creating value for its other stakeholders by ensuring that its corporate actions positively impact the socio-economic and environmental dimensions and contribute to sustainable growth and development.

ACKNOWLEDGEMENTS

Your Directors wish to place on record their gratitude to the National Housing Bank, Securities and Exchange Board of India, , Ministry of Corporate Affairs, Registrar of Companies, Financial Intelligence Unit (India), the Company’s Customers, Bankers and other Lenders, Members, and others for their continued support and faith reposed in the Company. The Board also places on record its deep appreciation for the dedication and commitment of the employees at all levels as their hard work, co-operation and support had enabled the Company to maintain its consistent growth. The Directors would also like to thank the BSE Limited, , National Securities Depository Limited, Central Depository Services (India) Limited and the Credit Rating Agencies for their continued co-operation.

CAUTIONARY STATEMENT

Statements in the Board’s Report and the Management Discussion & Analysis describing the Company’s objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Company’s operations include global and domestic demand and supply conditions affecting selling prices of finished goods, input availability and prices, changes in government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.

Registered office For, and on behalf of the Board

AKME Business Center (ABC),

4-5 Subcity Center Savina

Circle Udaipur-313002

Date : 30.08.2016 Mohan Lal Nagda Nirmal Kumar Jain

(Managing Director) (Director)

DIN 00211925 DIN 00240441

---

Mar 31, 2015

The Members

Akme Star Housing Finance Limited Udaipur

The Directors take pleasure in presenting the 10th Annual Report together with the audited financial statements for the year ended March 31, 2015. The Management Discussion and Analysis has also been incorporated into this report.

HIGHLIGHTS OF PERFORMANCE

The Company has achieved a gross income and net profit of Rs. 201.83 lacs and Rs. 66.69 lacs during the year under review as compared to Rs. 137.47 lacs and Rs. 36.74 lacs in the previous year respectively.

The housing loans/other loan outstanding during the year ended 31st March, 2015 were of Rs. 1232.20 lacs as against Rs. 895.58 lacs during the previous year.

The Net Owned Funds (NOF)/ Net worth of your Company is worth Rs 1538.25 Lacs as on 31.03.2015 as against Rs.1012.91 lacs during the previous year.

The Earnings Per Share (EPS) is Rs. 1.52 as at March 31, 2015 as against Rs. 0.94 as at March 31, 2014.

FINANCIAL RESULTS OF THE COMPANY

The Board's Report shall be prepared based on the stand alone financial statements of the company.

The Financial data for the current year and previous year are to be stated in a summarized form with the details of the appropriation of the credit balance (including the balance brought forward from the previous year).

Particular Rs. In Lacs 2014-15 2013-2014

Total Income 201.83 137.46

Total Expenditure 103.83 83.90

Profit before depreciation 99.74 54.33

Depreciation 1.74 0.77

Profit before Taxation 97.99 53.56

Provision for Taxation 31.30 16.81

Profit after Tax 66.69 36.74

Earnings Per Share 1.52 0.94

Net Owned Funds 1538.24 1012.91

DIVIDEND

To look after the further expansion of business activity and inadequacy of profits your directors do not recommend any payment of dividend for the year ended 31st March, 2015.

PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 read with Rule, 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, there are no employees of the Company covered under this section who is earning salary over and above specified limit.

AMENDMENT IN MEMORANDUM & ARTICLES OF ASSOCIATION

During the year under review, pursuant to a special resolution passed on September 10, 2015, in the Annual General Meeting, the Members of the Company had approved the adoption of new set of Articles of Association (AOA) of the Company (replacing the existing set of Articles of Association), in conformity with the provisions of the Companies Act, 2013

SHARE CAPITAL

- Authorized Share Capital

The authorized share capital of the Company stood at 6,00,00,000 (divided into 60,00,000 Equity Shares of Rs. 10/- each.

Company has increased its Authorized Capital during the year From Rs 3,00,00,000/- to Rs 6,00,00,000/-.

- Issued and Paid-up Capital

Your Company's Share Capital was at Rs 5.93 crore as at March 31, 2015 as compared to Rs 2.16 crore as at March 31, 2014. The increase was mainly on account of issuance and allotment of following equity shares:

1. Bonus Issue at Ratio of 1:1

2. Company has offered its Shares to the Public by way of IPO during the year.

FINANCE

Cash and cash equivalent as at March 31, 2015 was 402.44 lacs. The Company continues to focus on judicious management of its working capital. Receivables, inventories and other working capital parameters were kept under strict check through continuous monitoring.

DEPOSITS

Your Company has neither accepted nor invited any fixed deposit from the Public during the year under review as per NHB regulations.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013, apart from the loans made, guarantee given or security provided by the Company in the ordinary course of business are given in the Notes to accounts forming part of the Audited Financial Statements for the year ended March 31, 2015.

CREDIT RATING

The Company's borrowings enjoy the following Credit Ratings

CAPITAL ADEQUACY

As required under National Housing Bank Directions, your Company is presently required to maintain a minimum capital adequacy of 12% on a standalone basis. In addition, the National Housing Bank Directions also require that your Company transfers minimum 20% of its annual profits to a reserve fund.

Your Company's Capital Adequacy Ratio is at 133.26 % as at March 31, 2015, which provides an adequate cushion to withstand business risks and is above the minimum requirement of 12% stipulated by the National Housing Bank.

HUMAN RESOURCES AND TRAINING

The Company aims to align HR practices with business goals, motivate people for higher performance and build a competitive working environment. Productive high performing employees are vital to the company's success. The Board values and appreciates the contribution and commitment of the employees towards performance of your Company during the year. In pursuance of the Company's commitment to develop and retain the best available talent, the Company continued to offer in- house training program to staff members in executive development, leadership and management skills. The Company had organized various training programs for upgrading the skill and knowledge of its employees in different operational areas. The Company also sponsored its employees at various levels to attend various seminars and programs conducted by various organizations and institutions including Training programs conducted by the National Housing Bank so as to update their knowledge and to keep them abreast of all the developments in their respective fields.

Employee relations remained cordial and the work atmosphere remained congenial during the year.

DISCLOSURE UNDER SUB-SECTION (3) OF SECTION 134 OF COMPANIES ACT, 2013, READ WITH RULE 8(3) OF THE COMPANIES (ACCOUNTS) RULES, 2014

The details of conservation of energy, technology absorption, foreign exchange earnings and outgo are as follows:

- Conservation of energy:

The Company does not fall under any of the industries covered by the Companies (Disclosure of particulars of Directors) Rules, 1988.

- Technology absorption:

The Company is not involved in any technology absorption nor is there any R&D activity during the year

- Foreign Exchange Earnings and Outgo

Your company does not have any foreign exchange earnings and outgo during the year under review.

NATIONAL HOUSING BANK (NHB) GUIDELINES

The Company has complied with the provisions of the Housing Finance Companies (NHB) Directions, 2010 as prescribed by NHB and has been in compliance with the various Circulars, Notifications and Guidelines issued by National Housing Bank (NHB) from time to time. The Circulars and the Notifications issued by NHB are also placed before the Audit Committee / Board at regular intervals to update Committee / Board members on the same.

BUSINESS RISK MANAGEMENT

Pursuant to the requirement of the Listing Agreement, the Company has constituted a Business Risk Management Committee. The details of Committee and its terms of reference are set out in the Corporate Governance Report forming part of the Board's Report. The Company has a robust Business Risk Management (BRM) framework to identify, evaluate business risks and opportunities. This framework seeks to create transparency, minimize adverse impact on the business objectives and enhance the Company's competitive advantage. The business risk framework defines the risk management approach across the enterprise at various levels including documentation and reporting. The framework has different risk models which help in identifying risks trend, exposure and potential impact analysis at a Company level. . Risk management forms an integral part of the Company's Mid-Term Planning cycle.

During the year, the Board reviewed the risks associated with the business of the Company, its root causes and the efficacy of the measures taken to mitigate the same. The procedures are adopted to assess the risks and their mitigation mechanisms.

ASSET LIABILITY MANAGEMENT COMMITTEE (ALCO)

The Asset Liability Management Committee (ALCO) lays down policies and quantitative limits that involve assessment of various types of risks and shifts in assets and liabilities to manage such risks. ALCO ensures that the liquidity and interest-rate risks are contained within the limits laid down by the Board. The Company has also implemented NHB's Asset Liability Management Guidelines

CODES, STANDARDS & POLICIES KNOW YOUR CUSTOMER & ANTI MONEY LAUNDERING MEASURE POLICY

Your Company has a Board approved Know Your Customer & Anti Money Laundering Measure Policy (KYC & AML Policy) in place and adheres to the said Policy. The said Policy is in line with the National Housing Bank guidelines.

The Company has also adhered to the compliance requirement in terms of the said policy relating to the monitoring and reporting of cash / suspicious transactions. The Company furnishes to Financial Intelligence Unit (FIU), India, in the electronic medium, information of all cash transactions of the value of more than Rupees ten lakh or its equivalent in foreign currency and suspicious transactions whether or not made in cash, in terms of the said Policy.

- Fair Practice Code

Your Company has in place a Fair Practice Code (FPC), which includes guidelines on appropriate staff conduct when dealing with the customers and on the organization's policies vis-a-vis client protection. The FPC captures the spirit of the National Housing Bank guidelines on fair practices for Housing Finance Companies.

During the year under review, FPC was modified by the Board and the grievance redressal mechanism within the Company was further strengthened.

- Code Of Conduct For Board Members And The Senior Management

Your Company has adopted a Code of Conduct for its Board Members and Senior Management personnel. The code requires the directors and employees of the Company to act honestly, ethically and with integrity and in a professional and respectful manner.

The declaration by the Chairman & Managing Director of the Company regarding compliance with the Code of Conduct for Board Members and Senior Management is annexed with the Corporate Governance report.

- Code For Prevention Of Insider Trading Practices

Your Company has formulated and adopted a Code for Prevention of Insider Trading Practices in accordance with the model code of conduct as prescribed under the SEBI (Prohibition of Insider Trading) Regulations, 2015, as amended. The code lays down guidelines, which includes procedures to be followed and disclosures to be made while dealing in the shares of the Company.

The code is applicable to the promoters, directors, senior designated employees and their dependents and the said persons are restricted from dealing in the securities of the Company during the 'restricted trading periods' notified by the Company, from time to time.

- Code Of Business Ethics (COBE)

Your Company has adopted a Code of Business Ethics (COBE) which lays down the principles and standards that govern the activities of the Company and its employees to ensure and promote ethical behavior within the legal framework of the organization.

- Whistle Blower Policy

Your Company believes and is committed to adhere to high ethical standards and compliance with laws and regulations applicable to its business. Company adopted a Whistle Blower Policy which provides for a vigil mechanism that encourages and supports its Directors and employees to report to the management / Chairperson of the Audit Committee instances of unethical behavior, actual or suspected, fraud or violation of the Company's Code of Conduct or Ethics Policy.

The said policy, however, provides for adequate safeguards against the victimization of the Whistle Blower who avail this mechanism. The policy also provides for direct access to the Chairperson of the Audit Committee in exceptional cases.

- Sexual Harassment Policy

The policy on "Workplace Sexual Harassment" was formulated and an Internal Complaints Committee (ICC) was also constituted as per the provisions of "Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The said policy seeks to protect women employees from sexual harassment at the place of work. The primary objective of the same is to safeguard the interest of female employees in the Company and also provides for punishment in case of false and malicious representations.

- Comprehensive Risk Management Policy

Your Company has formulated and adopted a Comprehensive Risk Management Policy which covers a formalized Risk Management Structure, along with other aspects of Risk Management i.e. Credit Risk Management, Operational Risk Management, Market Risk Management and Enterprise Risk Management. The Risk Management Committee of the Board, on periodic basis, oversees the risk management systems, processes and minimization procedures of the Company.

- Corporate Social Responsibility (CSR)

Considering these, the concept of Corporate Social Responsibility (CSR) is the demand of the current era. CSR has become a concept that frequently overlaps similar approaches, such as corporate sustainability, corporate sustainable development and corporate responsibility.

Your Company is a socially responsible organization and always keen to promote the interest of customers, employees, shareholders and communities as a whole.

Our founder chairman's vision and legacy continues to guide our company and our people. Social responsibility is a way of life at AHFL. It means investing in and enriching our communities. It means encouraging employee volunteerism.

Company has constituted a CSR Committee on in Board meeting held on 13th March 2015.

- Remuneration Policy

The Board of Directors had on the recommendation of the Nomination & Remuneration Committee Appointed Mrs. Rajni Gehlot Independent Director as Chairman, Mr. Amrit Singh Rajpurohit and Mr. Avinash Bhatnagar Independent Director as Member.

The Company follow a Policy on remuneration of Directors and senior management Employees, The Policy is approved by the Nomination & Remuneration Committee and the Board.

VIGIL MECHANISM

Fraud free and corruption free work culture has been core to the Company. on view of the potential risk of fraud and corruption due to rapid growth and geographical spread of operations, the company has put an even greater emphasis to address this risk.

The Audit Committee of the Company is also looking for prevent the fraud under the Vigil mechanism for the Company.

LISTING OF SHARES OF THE COMPANY

The Equity Shares of your Company continue to remain listed on the BSE Ltd. and the National Stock Exchange of India Limited. The Company has paid the listing fees as payable to the BSE Ltd. and the National Stock Exchange Limited for the financial year 2013-14.

DIRECTORS AND KEY MANAGERIAL PERSONAL

- Appointment

To meet out the requirement of Companies Act 2013 and SME Listing Agreement Company has appointed Mr. Avinash Bhatnagar as Independent Director in Board of Directors meeting as Additional Director on 15.09.2014.

As an Additional Director, Mr. Avinash Bhatnagar shall hold office up to the date of ensuing General Meeting. The Company has received notice as per section 160 (1) of the Companies Act 2013 from a member proposing her appointment as Director. The Board of Directors recommends his appointment.

Further details about the all directors are given in Corporate Governance report as well as in the Notice of the ensuing General Meeting being sent to the shareholders along with Annual Report

- Appointment of Independent Directors

The Board appointed all the existing Independent Directors viz. Mr. Amrit Singh Rajpurohit and Mrs. Rajni Gehlot as Independent Director under Section 149 of the Companies Act 2013 for a term of Five Years from the 9th Annual general Meeting.

The Shareholder approves their appointment in Annual General Meeting held on 10th September 2014.

All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Clause 52of the Listing Agreement

- Retire By Rotation

In accordance with the provisions of section 152 (6) of the Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company, Mr. Kalu Lal Jain (DIN 00451442) will retire by rotation at the ensuing general meeting of the Company and being eligible offer themselves for re- appointment. The Board recommends their re appointment.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Clause 52 of the SME Listing Agreement, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Nomination & Remuneration and Compliance Committees.

MEETINGS

A calendar of Meetings is prepared and circulated in advance to the Directors. During the year 13 Board Meetings and 4 (Four) Audit Committee Meetings were convened and held. The details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year were on an arm's length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

All Related Party Transactions are placed before the Audit Committee as also the Board for approval. The transactions entered into pursuant to the omnibus approval so granted are audited and a statement giving details of all related party transactions is placed before the Audit Committee and the Board of Directors for their approval on a half yearly basis.

SIGNIFICANT/MATERIAL ORDERS PASSED BY THE REGULATOR OR COURT OR TRIBUNALS

There were no significant/material orders passed by any Regulator or Court or Tribunal which would impact the going concern status of the Company and its future operations

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board.

The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies of the Company. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board.

The internal audit department also assesses opportunities for improvement in business process systems and controls provides recommendations, designed to add value to the organization and follows up on the implementation of corrective actions and improvements in business process after review by the Audit Committee.

SECRETARIAL AUDITOR & SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed Mr. Ronak Jhuthawat Proprietress of M/s Ronak Jhuthawat & Co., Practicing Company Secretaries, Udaipur, to undertake the Secretarial Audit of the Company for the financial year 2014-15. The Secretarial Audit Report for the financial year ended March 31, 2015, is annexed as "Annexure - A" to this report. The said report, does not contain any qualification, reservation or adverse remark, however, contains certain observations of the Secretarial Auditor which are self explanatory, and thus do not call for any further comments. "Annexure A".

AUDITORS

- Statutory Auditors

The Company's Statutory Auditors, M/s Nyati Mundra & Co. (ICAI Firm Registration No. 08153C ), Chartered Accountants, Udaipur will hold office until the conclusion of the ensuing Annual General Meeting of the Company are eligible for reappointment as per section 139 of the Companies Act 2013.

M/s Nyati Mundra & co have expressed their willingness to get re appointed as the statutory auditors of the company and They have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the Rules framed there under for reappointment as Auditors of the Company. As required under Clause 52 of the SME Listing Agreement, the auditors have also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.

The Board based on the recommendation of the audit committee recommends the re appointment of M/s Nyati Mundra & co as the statutory Auditor of the Company.

The Members are requested to appoint M/s Nyati Mundra & co Chartered Accountants as Auditors from the conclusion of the ensuing annual general meeting till the Conclusion of the next Annual General Meeting in 2016 and to authorize the Board to fix their remuneration for the year 2015.

- Notes to Accounts and Auditors Report

The notes to the accounts referred to in Auditors Report are self-explanatory and do not call for any further comments. The Statutory Auditors Report does not contain any qualification, reservation or adverse remark.

DIRECTORS' RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134 (3) (c) of the Companies Act, 2013:

- that in the preparation of the annual financial statements for the year ended March 31, 2015, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

- that such accounting policies as mentioned in Note of the Notes to the Financial Statements have been selected and applied consistently and judgment and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2015 and of the profit of the Company for the year ended on that date;

- that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

- that the annual financial statements have been prepared on a going concern basis;

- that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively;

- that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

CORPORATE GOVERNANCE

Pursuant to Clause 52 of the listing agreement with Stock Exchanges, a separate section titled Report on Corporate Governance forms part of this Annual Report. The Report on Corporate Governance also includes certain disclosures that are required, as per Companies Act, 2013.

Auditors' Certificate confirming compliance with the conditions of Corporate Governance as stipulated under Clause 52 of the Listing Agreement also forms part of this Annual Report.

EXTRACT OF ANNUAL RETURN

Pursuant to Section 134 (3) (a) and Section 92(3) of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014,the extract of the Annual Return as at March 31, 2015, in the prescribed form MGT 9,forms part of this report and is annexed as "Annexure B ".

ENHANCING SHAREHOLDERS VALUE

Your Company believes that its Members are among its most important stakeholders Accordingly, your Company's operations are committed to the pursuit of achieving high levels of operating performance and cost competitiveness, consolidating and building for growth, enhancing the productive asset and resource base and nurturing overall corporate reputation. Your Company is also committed to creating value for its other stakeholders by ensuring that its corporate actions positively impact the socio-economic and environmental dimensions and contribute to sustainable growth and development.

ACKNOWLEDGEMENTS

Your Directors thank the various departments like NHB, MCA, Registrar of Companies, various Organizations and Agencies for the continued help and co-operation extended by them. The Directors also gratefully acknowledge all stakeholders of the Company viz. customers, members, dealers, vendors, banks and other business partners for the excellent support received from them during the year. The Directors place on record their sincere appreciation to all employees of the Company for their unstinted commitment and continued contribution to the Company.

CAUTIONARY STATEMENT

Statements in the Board's Report and the Management Discussion & Analysis describing the Company's objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Company's operations include global and domestic demand and supply conditions

affecting selling prices of finished goods, input availability and prices, changes in government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.

Registered office For and on behalf of the Board AKME Business Center 4-5 Subcity Center Savina Circle Udaipur.313002 Sd/- Sd/- Date: 11.07.2015 Mohan Lal Nagda Nirmal Kumar Jain (Managing Director) (Director) DIN 00211925 DIN 00240441