Directors Report of 5Paisa Capital Ltd.

Mar 31, 2025

Your Directors'' take pleasure in presenting the 18^th (Eighteenth)
Annual Report on the business and operations of 5paisa Capital
Limited ("Company", "Your Company", "We") along with the
Audited Financial Statements for the Financial Year ended
March 31, 2025 ("year under review" or "year" or "FY 2024¬
25"). The consolidated performance of your Company and its
subsidiaries has been referred to wherever required.

In compliance with the applicable provisions of the Companies
Act, 2013 ("the Act") (including any statutory modification(s)
or re-enactment(s) thereof, for the time being in force and the
Securities and Exchange Board of India (Listing Obligations

and Disclosure Requirements) Regulation, 2015 ("the Listing
Regulations"), this report covers the financial performance and
other developments during the Financial Year 2024-25 and upto
the date of the Board Meeting held on July 08, 2025 to approve
this report in respect of 5paisa Capital Limited on a Standalone
basis as well as on a Consolidated basis comprising of 5paisa
Capital Limited and its Subsidiaries.

FINANCIAL HIGHIGHTS:

Your Company''s Standalone and Consolidated financial
performance during Financial Year 2024-25, as compared with
that of the previous Financial Year 2023-24 is summarized below:

Particulars	Consolidated		Standalone
	FY 2024-25	FY 2023-24	FY 2024-25	FY 2023-24
Gross total income	3,598.46	3,947.36	3,596.69	3,945.58
Profit / (Loss) before interest, depreciation and taxation	1,272.44	1,102.27	1,271.66	1,067.06
Interest and financial charges	238.01	285.68	238.01	285.68
Depreciation	122.24	95.33	122.24	94.71
Profit / (Loss) before tax	912.19	721.26	911.41	686.67
Taxation - Current	258.25	195.28	258.25	195.28
- Deferred	(28.40)	(18.43)	(28.02)	(27.14)
- Short or excess provision for income tax	-	-	-	-
Net profit / (Loss) for the year	682.34	544.41	681.18	518.53
Less: Appropriations	-	-	-	-
Add: Balance brought forward from the previous year	624.18	79.77	633.22	114.69
Balance to be carried forward	1,306.52	624.18	1,314.40	633.22

Note(s):

1. Previous periods'' figures have been re-grouped /
re-arranged wherever necessary.

2. Figures in brackets represent deduction(s).

The statement containing extract of subsidiaries financial
statement are provided on the corporate website at https://
www.5paisa.com/investor-relations

CONSOLIDATED FINANCIAL STATEMENTS:

The Consolidated Financial Statements of your Company for
the FY 2024-25 are prepared in compliance with the applicable
provisions of the Companies Act, 2013 ("the Act"), Indian
Accounting Standards ("Ind-AS") and the Securities and
Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015 ("the Listing Regulations").
The Consolidated Financial Statements have been prepared on
the basis of Audited Financial Statements of the Company and
its subsidiaries, approved by their respective Board of Directors.

Copies of the Balance Sheet, Statement of Profit and Loss,
Report of the Board of Directors and Report of the Auditors of
the subsidiary companies are not attached to the accounts of
your Company for the financial year 2024-25. Your Company
will arrange for soft copies of these documents / details upon
request by any member of the Company and dispatch the same
on the registered email address of the member.

These documents / details will also be available for inspection
by any member of your Company at its registered office and
at the registered offices of the concerned subsidiary during
the business hours on working days i.e. except on Saturdays,
Sundays and Public Holidays. If any member is interested
in obtaining a copy thereof, such member may write to the
Company Secretary, whereupon a soft copy of the same would
be sent to the registered email address of the member. The
Annual Report of subsidiaries is uploaded on our corporate
website at https://www.5paisa.com/investor-relations. As
required by the Companies Act, 2013 and Accounting Standard
- 21 (AS 21) issued by the Institute of Chartered Accountants
of India, your Company''s Consolidated Financial Statements

included in this Annual Report incorporate the accounts of its
subsidiaries. A report on the performance and financial position
of the subsidiaries is provided in the prescribed form AOC-1 as
"Annexure - I" to this Directors'' Report.

The policy on determining the material subsidiary is available
on our corporate website: https://www.5paisa.com/investor-
relations

REVIEW OF BUSINESS AND OPERATIONS AND STATE
OF YOUR COMPANY''S AFFAIRS:

Over the next ten years, major megatrends in the Indian capital
markets will fundamentally reshape the financial landscape.
The increasing digitisation of financial services is a key driver,
as reflected in the growing retail participation and the rising
financial awareness among younger generations, who are
entering the stock markets earlier and prefer digital platforms
and self-directed investments. The last five years have witnessed
a multi-fold surge in demat accounts especially post the covid
pandemic, signalling a structural shift towards broader market
participation and confidence in the Indian economy. At the
same time, the Indian capital market share steadily maturing,
supported by improving regulations, robust compliance norms,
enhanced investor education and deeper retail participation.
Additionally, the increasing focus on environmental, social and
governance (ESG) factors will drive demand for ESG-compliant
investment products, pushing the industry toward sustainable
and responsible investment offerings.

Following a year of market volatility, regulatory tightening
and shifting investor sentiment, were directed our strategic
focus from broad-based innovation to strengthening the
customer experience, adding new trading features, technology
optimisation and delivering a dedicated platform for FnO
traders - FnO 360.

While we continue to invest in advanced technologies - including
AI-driven insights, automation and scalable APIs - our priority
in the past year was to enhance platform reliability, speed,
margin transparency and risk controls so that active traders
can operate with confidence. As India''s regulatory environment
evolves to reinforce transparency, compliance and investor
protection, we believe this disciplined, customer-first approach
will position us for a decade of inclusive, sustainable innovation
across India''s capital markets.

Your Company has improved its financial performance by
offering investors a digital platform with a range of features
that enables them to learn more about the financial world, make
informed decisions, invest through its mobile application and
increase their participation and profits from the financial market.
The revenue this year stood at ? 3,598 million in FY 2024-25, a
decrease of 9 % Y-o-Y The Company earned a net profit after tax
of ? 682 million in FY 2024-25, a growth of 25 % on Y-o-Y basis.
This is due to the Company''s dedication to meet the needs of
its esteemed customers, its consistent efforts to build the right
teams and culture and its integration of innovation, technology
and sustainability at the heart of its operations.

For a detailed overview of your company''s performance
during the year, refer to Management Discussion and
Analysis Report of the Annual Report. Throughout the year,
the company focused on leveraging technology to enhance
customer experience, expanding cohort-based personalized
service offerings, strengthening the Algo and API ecosystem
and fortifying strategic partnerships to drive innovation and
market expansion. As a result, the company has reinforced
its position as a key player in the discount broking industry by
consistently delivering exceptional services and creating value
for all stakeholders..

MACRO-ECONOMIC OVERVIEW:

Read more about your company''s performance during the year
in the Management Discussion and Analysis Report section of
this report.

INDUSTRY OVERVIEW:

Read more about your company''s performance during the year
in the Management Discussion and Analysis Report section of
this report.

RETURN TO INVESTORS (DIVIDEND):

In order to conserve the resources of your Company for future
business expansion and strategic initiatives, the Directors have
decided not to recommend any dividend on equity shares of
your Company for the financial year under review.

The Dividend Distribution Policy is available on the website at
https://www.5paisa.com/investor-relations.

TRANSFER TO GENERAL RESERVE:

During the year under review, your Company has not transferred
any amount to the reserves.

LISTING FEES:

Your Company has duly paid the annual listing fees for FY 2024¬
25 to both the National Stock Exchange of India Limited
(Symbol: 5PAISA) and BSE Limited (Scrip Code: 540776), where
its securities are listed.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR
EDUCATION AND PROTECTION FUND (IEPF):

The Company has not declared any dividend till date, therefore
there is no case of unclaimed dividend and further no dividend
amount is required to be transferred to Investor Education and
Protection Fund (IEPF).

TRANSFER OF SHARES TO INVESTOR EDUCATION
AND PROTECTION FUND:

The Company has not transferred any shares to Investor
Education and Protection Fund during the year under review.

TRANSFER OF SALE PROCEEDS TO INVESTOR
EDUCATION AND PROTECTION FUND:

Pursuant to the Scheme of Arrangement approved by the
Hon''ble National Company Law Tribunal, Mumbai, vide its order

dated September 06, 2017, between IIFL Finance Limited and
5paisa Capital Limited, the shareholders of IIFL Finance Limited
were allotted shares in 5paisa Capital Limited. This resulted in
12,707 equity shares being allotted as fractional entitlements,
which were consolidated, sold in the market, and the sale
proceeds were credited to a designated bank account on June
25, 2018.

As per the Investor Education and Protection Fund Authority
(Accounting, Audit, Transfer and Refund) Rules, 2016, as
amended from time to time, any amount remaining unclaimed
or unpaid for a period of seven years is required to be transferred
to the Investor Education and Protection Fund ("IEPF”). Further,
the amount must be credited to the IEPF within 30 days from
the due date of transfer.

Accordingly, the sale proceeds relating to the unclaimed
fractional entitlements arising out of the Scheme of
Arrangement which became due for transfer on June 25, 2025
are required to be transferred to the IEPF on or before July 25,
2025. As on date of the report, the Company is currently in the
process of completing this transfer.

CREDIT RATING:

CRISIL Ratings Limited ("CRISIL”), the credit rating agency,
vide its letter dated February 12, 2025, has assigned and/or
re-affirmed the credit ratings for various facilities of the
Company. The same has been disclosed in the Corporate
Governance Report forming part of the annual report.

AWARDS AND RECOGNITION:

Your Company received numerous awards and accolades which
were conferred by reputable organizations and is designed to
honour the efforts made by us and the details of the same are
given herein below:

• Prime Time Awards 2022, Media Best Integration of Digital
Content with TV.

• India Content Leadership Awards 2023, Inkspell Best
Content in a Financial Services App.

• India Content Leadership Awards 2023, Inkspell Best
Financial Content on Social Platform(s).

• Masters of Modern Marketing Awards 2023, Inkspell Multi
Channel campaign for a Financial Services Enterprise -
Special Mention 5paisa.

• Passing 1 Lakh Subscribers on YouTube.

• Passing 1 Million Subscribers on YouTube.

• Safe Workplace Award by CecureUs - FY 2024-25.

• MCX Awards 2025 Leading Member - Client Participation.

SHARE CAPITAL:

The authorised share capital of your Company as on March
31, 2025 was ? 80,00,00,000/- (Rupees Eighty Crores only).
The paid-up equity share capital of your Company as on
March 31, 2025 was ? 31,23,63,380/- divided into 3,12,36,338
Equity Shares of ? 10/- each as compared to ? 31,19,09,730/-

divided into 3,11,90,973 Equity Shares of ? 10/- each as on
March 31,2024.

The increase in the share capital was on account of exercise
of 32,865 ESOPs granted under the 5paisa Capital Limited
Employee Stock Option Scheme 2017 and on account of exercise
of 12,500 ESOPs granted under the 5paisa Capital Limited
Employee Stock Option Scheme 2023, by eligible employees,
which were converted into Equity Shares of ? 10/- each.

Your Company had made following allotments during FY 2024-25:

Sr. No.	Date of Allotment	No. of Shares Allotted	ESOP Scheme
1.	April 24, 2024	250 Equity Shares	5paisa Capital Limited Employee Stock Option
2.	May 21,2024	4,500 Equity Shares	Scheme 2017
3.	June 04, 2024	6,750 Equity Shares
4.	June 20, 2024	7,290 Equity Shares
5.	July 12, 2024	4,000 Equity Shares
6.	August 08, 2024	6,350 Equity Shares
7.	September 25, 2024	1,025 Equity Shares
8.	November 08, 2024	2,700 Equity Shares
9.	February 14, 2025	12,500 Equity Shares	5paisa Capital Limited Employee Stock Option Scheme 2023

EMPLOYEES STOCK OPTION SCHEMES ("ESOS"):

The Employees'' Stock Option Schemes enable your Company
to hire and retain the best talent for its Senior Management and
key positions. The Nomination and Remuneration Committee of
the Board of Directors of your Company, inter-alia, administers
and monitors the Employees'' Stock Option Schemes in
accordance with the applicable SEBI Regulations.

ESOS of your Company are in line with SEBI (Share Based
Employee Benefits and Sweat Equity) Regulations, 2021
("SBEBSE Regulations"). Your Company, presently, has
three Schemes:

1. 5paisa Capital Limited Employee Stock Option Scheme
2017 ("5PCL ESOS 2017") was approved by shareholders
vide special resolution dated January 25, 2018.

2. 5paisa Capital Limited Employee Stock Option Trust
Scheme 2017 ("5PCL ESOTS 2017") was approved
by shareholders vide special resolution dated January
25, 2018.

3. 5paisa Capital Limited Employee Stock Option Scheme
2023 ("5PCL ESOS 2023") was approved by shareholders
vide special resolution dated August 31,2023.

As per Regulation 14 of "SBEBSE Regulations”, the details of the
"ESOS” are disclosed on our corporate website which can be
accessed at https://www.5paisa.com/investor-relations.

A certificate from the Secretarial Auditors of the Company
stating that the aforesaid schemes have been implemented
in accordance with the SEBI (Share Based Employee Benefits
and Sweat Equity) Regulations, 2021 and in accordance with
the resolution passed by the members shall be available at the
ensuing Annual General Meeting for inspection by members.

PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE,
GUARANTEES GIVEN AND SECURITIES PROVIDED
UNDER SECTION 186 OF THE COMPANIES ACT, 2013:

Particulars of loans given, investments made, guarantees
given and securities provided as covered under the provisions
of Section 186 of the Act are set out in the notes to the
accompanying financial statements of your Company.

LOAN FROM DIRECTORS OR THEIR RELATIVES:

During the year under review, there are no loan taken from the
Directors or their relatives by the Company.

DEPOSITS:

During the year under review, your Company has not accepted
any deposits from the public falling under the ambit of
Section 73 of the Companies Act, 2013 read with Companies
(Acceptance of Deposits) Rules, 2014. Therefore, payment on
the account of principal or interest amount on deposits from
the public does not arise.

SUBSIDIARY COMPANIES:

As on 31^st March 2025, the Company had 4 (four) wholly
owned subsidiaries. During the financial year, your Board
of Directors reviewed the operations and performance of all
subsidiary companies.

The Consolidated Financial Statements of the Company
have been prepared in compliance with Section 129(3) of
the Companies Act, 2013 and are included as part of this
Annual Report. A summary of the key financial highlights of
the subsidiaries, presented in the prescribed format AOC-1,
is attached as "Annexure - I" to the Directors'' Report. This
annexure outlines the financial performance and position of
each subsidiary.

Details of Subsidiary Companies:

• 5paisa P2P Limited

5paisa P2P Limited is a wholly owned subsidiary of 5paisa
Capital Limited. The company received Certificate of
Registration from Reserve Bank of India ("RBI") bearing
registration number N-13.02371 to act as NBFC P2P.

• 5paisa Corporate Services Limited

5paisa Corporate Services Limited is a wholly owned
subsidiary of 5paisa Capital Limited incorporated on
October 27, 2018. The name of the company was changed
from "5paisa Insurance Brokers Limited” to "5paisa
Corporate Services Limited” with effect from November 16,
2022 pursuant to receipt of fresh Certificate of Incorporation
dated November 16, 2022 issued by the Registrar of
Companies, Mumbai. The Company shall commence its
business shortly.

• 5paisa Trading Limited

5paisa Trading Limited was incorporated as a public limited
company on February 27, 2020 as a wholly owned subsidiary
of 5paisa Capital Limited.

• 5paisa International Securities (IFSC) Limited

5paisa International Securities (IFSC) Limited was
incorporated as a public limited company on June 15, 2022
as a wholly owned subsidiary of 5paisa Capital Limited.
5paisa International Securities (IFSC) Limited is incorporated
with the object of carrying out business of IFSC (International
Financial Service Centre) Unit and act as intermediary in
IFSC. The Company shall commence its operations after
receipt of necessary clearances / licenses.

The separate audited financial statements of each subsidiary
company are available for inspection and can also be accessed
on the Company''s website at https://www.5paisa.com/investor-
relations.

In accordance with the provisions of Regulation 34(3) read
with Schedule V of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015, the details of loans and
advances extended to, as well as investments made in,
the subsidiary companies are disclosed in the Notes to the
Financial Statements.

Furthermore, the Company did not have any joint venture or
associate companies during the year under review, nor at
any time after the financial year ended and up to the date of
this Report.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

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

CORPORATE GOVERNANCE:

Your company is dedicated to maintaining transparency in all
its transactions and prioritizes strong business ethics. It has
put in place an effective Corporate Governance system which
ensures that provisions of the Act and Listing Regulations are
duly complied with, not only in form but also in substance.

In accordance with Regulation 34 of the Securities and
Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015, a comprehensive Report on
Corporate Governance forms part of this Annual Report.

M/s. V Sankar Aiyar & Co., Chartered Accountants, Statutory
Auditors of the Company have conducted a review of the
Company''s compliance with the applicable Corporate
Governance provisions under the Listing Regulations. Their
certification confirming compliance is appended to the
Corporate Governance Report.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY
REPORT ("BRSR"):

The Business Responsibility and Sustainability Report
prepared pursuant to SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015, forms part of this
Annual Report.

BOARD OF DIRECTORS AND KEY MANAGERIAL
PERSONNEL:

5paisa is dedicated to embracing leading global standards to
ensure the Board operates effectively and further is committed
to fostering a genuinely diverse Board, whose insights and
capabilities can be harnessed to drive enhanced stakeholder
value, protect their interests and improve corporate governance.
Your Company''s Board comprises of eminent persons with
proven competence and integrity, who bring in vast experience
and expertise, strategic guidance and leadership qualities.

1. Composition of Board of Directors:

The Board of Directors of the Company is structured in
compliance with Section 149 of the Companies Act, 2013
and Regulation 17 of the Listing Regulations thereby
ensuring an appropriate combination of Executive, Non¬
Executive and Independent Directors.

As on the date of this Boards Report i.e. as on July 08,
2025, your Company''s Board of Directors comprises of
following Directors:

Name of the Director	DIN	Designation
Dr. Archana Hingorani	00028037	Non - Executive Independent Director and Chairperson
Mr. Milin Mehta	01297508	Non - Executive Independent Director
Mr. Ravindra Garikipati	00984163	Non - Executive Independent Director
Ms. Nirali Sanghi	00319389	Non - Executive Independent Director
Dr. Sarat Kumar Malik	09791314	Additional Non - Executive Independent Director

Mr. Gaurav Seth	10415364	Managing Director and Chief Executive Officer
Mr. Gourav Munjal	06360031	Whole Time Director and Chief Financial Officer
Mr. Ameya Agnihotri	07680132	Whole Time Director and Chief Technology Officer

2. Changes in Board Composition:

During the year and upto the date of this report, following
changes took place in the Directorships:

Appointment / Cessation:

In order to pursue additional responsibilities as a
Strategic Advisor to the IIFL group in their new initiatives
towards Artificial Intelligence and Digital Transformation,
Mr. Narayan Gangadhar (DIN: 09298665), vide his letter
dated May 30, 2024 resigned from the post of Managing
Director and Chief Executive Officer (CEO) of the Company
w.e.f. August 28, 2024 where the said resignation was
accepted by the Board vide Circular Resolution dated May
30, 2024.

Consequently, he also ceased to be the Member of the
Risk Management Committee, Stakeholder Relationship
Committee, Corporate Social Responsibility (CSR)
Committee, Finance Committee, Environmental,
Social and Governance (ESG) Committee, Information
Technology (IT) Committee and Cyber Security Committee
of the Company.

Further, the Board of Directors, based on the
recommendation of Nomination and Remuneration
(NRC) Committee, at their meeting held on Friday, July 12,

2024 appointed Mr. Ameya Agnihotri (DIN: 07680132) as
Additional Director in the capacity of Whole Time Director
of the Company w.e.f. July 13, 2024 pursuant to which
his appointment was approved by the Members of the
Company by way of passing of Special Resolution at their
Annual General Meeting held on September 10, 2024.

Further Mr. Ameya Agnihotri was also appointed as a
Member of the Corporate Social Responsibility (CSR)
Committee, Stakeholders Relationship (SRC) Committee,
Finance Committee, Environmental, Social and
Governance (ESG) Committee.

Further, the Board of Directors, based on the recommendation
of Nomination and Remuneration (NRC) Committee, at their
meeting held on January 14, 2025 appointed Mr. Gaurav
Seth (DIN: 10415364) as Chief Executive Officer (CEO) of

the Company w.e.f. January 14, 2025 and further, based
on the recommendation of Nomination and Remuneration
(NRC) Committee, at their meeting held on January 17,

2025 appointed him as a Managing Director of the
Company w.e.f. January 17, 2025 pursuant to which

his appointment was approved by the Members of the
Company by way of passing of Ordinary Resolution vide
Postal Ballot Notice dated February 12, 2025, the results
of which were declared on March 25, 2025.

Further, the Board of Directors, based on the
recommendation of the Nomination and Remuneration
Committee (NRC), at their meeting held on July 08, 2025,
appointed Dr. Sarat Kumar Malik (DIN: 09791314) as an
Additional Non - Executive Independent Director of the
Company with effect from July 08, 2025 to hold office till
the conclusion of ensuing Annual General Meeting and
subject to the approval of Members in the ensuing Annual
General Meeting, for appointment as an Independent
Director to hold office for a 1^st (First) term of 5 (Five)
consecutive years.

There was no change in the composition of the Board
of Directors during the year under review, except as
stated above.

3. Key developments in the Board Composition pursuant to
the conclusion of the financial year:

No key developments had taken place in the Board
Composition subsequent to the conclusion of the
Financial Year except as stated above. Further, the details
mentioning the changes in Board composition during the
year have already been discussed in detail in the Corporate
Governance Report which forms part of the Annual Report.

4. Retirement by Rotation:

Pursuant to Section 152 of the Companies Act, 2013, read
with rules made thereunder and Articles of Association
of your Company, Mr. Ameya Agnihotri (DIN: 07680132),
Whole-time Director and Chief Technology Officer of
your Company, retires by rotation at the 18^th Annual
General Meeting of the Company and being eligible for
re-appointment has offered himself for re-appointment.
Based on the recommendation of the Nomination and
Remuneration Committee, the Board has recommended
the re-appointment of Mr. Ameya Agnihotri as Whole¬
time Director of the Company at the ensuing AGM. A brief
profile and other information, as required under Secretarial
Standard-2 and Regulation 36 of the Listing Regulations,
are provided in the AGM Notice.

5. Key Managerial Personnel:

Pursuant to the provisions of Section 2(51) and Section 203
of the Companies Act, 2013 and rules made thereunder,
the Key Managerial Personnel ("KMPs") of your Company
as on March 31,2025 are:

Mr. Gaurav Seth	: Managing Director and Chief Executive Officer
Mr. Gourav Munjal	: Whole-Time Director and Chief Financial Officer

Mr. Ameya Agnihotri	: Whole-time Director and Chief Technology Officer
Mrs. Namita Godbole	: Company Secretary and Chief Compliance Officer (Resigned w.e.f. July 11, 2025)

The Remuneration and other details of the Key Managerial
Personnel for the year ended March 31,2025 are mentioned
in Form MGT-7 - Annual Return which can be accessed
on our corporate website at https:// www.5paisa.com/
investor-relations.

Further, pursuant to SEBI Circular No. SEBI/HO/MIRSD/
MIRSD-PoD-1/P/CIR/2023/24 dated February 06, 2023,
your company has recognized and has designated
following senior officers as a Key Managerial Personnel
of your company for managing the key risks.

Mrs. Namita Godbole	: Chief Compliance Officer (Resigned w.e.f. July 11,2025)
Mr. Yogesh Maroli	: Chief Information Security Officer (CISO)

6. Independent Directors:

The Independent Directors have been familiarized with
the Company, their roles, rights and responsibilities in
the Company. The details of Familiarization Programmes
are available on the website of the Company at https://
www.5paisa.com/investor-relations.

The Company has received requisite declarations from
all the Independent Directors of the Company confirming
that they meet the criteria of independence prescribed
under Section 149(6) of the Act read with Rule 5 of the
Companies (Appointment and Qualification of Directors)
Rules, 2014 and Regulation 16(1)(b) of the SEBI Listing
Regulations. The Independent Directors have also
confirmed that they are not aware of any circumstance or
situation that exists 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. This has been noted by the Board
of Directors.

In the opinion of the Board, all the Independent Directors
satisfy the criteria of independence as defined under the Act,
rules framed thereunder and the SEBI Listing Regulations,
and that they are independent of the Management of the
Company. In the opinion of the Board, all Independent
Directors (including those appointed during the year)
possess requisite qualifications, experience, expertise,
proficiency and hold high standards of integrity for the
purpose of Rule 8(5)(iiia) of the Companies (Accounts)
Rules, 2014. In terms of the requirements under the SEBI
Listing Regulations, the Board has identified list of key
skills, expertise and core competencies of the Board,

including the Independent Directors, details of which are
provided as part of the Corporate Governance Report.

As required under Rule 6 of the Companies (Appointment
and Qualification of Directors) Rules, 2014, all the
Independent Directors (including those appointed during
the year) have registered themselves with the Independent
Directors Databank and completed the online proficiency
test conducted by the Indian Institute of Corporate Affairs,
wherever required.

BOARD MEETINGS:

During the year, 5 (Five) Board Meetings were convened and
held on April 24, 2024; July 12, 2024; October 17, 2024; January
14, 2025 and January 17, 2025. The particulars of attendance of
the Directors at the said meetings are detailed in the Corporate
Governance Report of the Company, which forms part of this
Report. The intervening gap between consecutive Meetings
was within the statutory limit prescribed under the Act and
Listing Regulations.

Further, the details regarding the Audit Committee, Nomination
and Remuneration Committee, Stakeholders'' Relationship
Committee, Risk Management Committee, Corporate Social
Responsibility (CSR) Committee, Environment, Social and
Governance (ESG) Committee, Finance Committee, Information
Technology (IT) Committee and Cyber Security Committee,
including the meetings held during the year, are disclosed in
the Corporate Governance Report.

MEETING OF INDEPENDENT DIRECTORS:

As per the Provisions of the Companies Act, 2013 and
Regulation 25(3) of the SEBI Listing Regulations, a separate
meeting of the Independent Directors of your Company was
held on March 24, 2025, without the presence of Executive
Directors or Non-Independent Directors.

The meeting was conducted in an informal and flexible
manner to facilitate free and Independent discussions. The
Independent Directors, inter-alia, reviewed the performance
of Non-Independent Directors and the Board as a whole; the
performance of the Chairperson of the Company; assessed the
quality, quantity and timeliness of flow of information between
the Company Management and the Board that is necessary
for the Board to effectively and reasonably perform its duties.

COMMITTEES OF THE BOARD:

Your Company has constituted various Board level committees
in accordance with the requirements of the Act and the
Listing Regulations. Further, the Company being categorized
as Qualified Stock Broker (QSB) has also constituted other
additional committees as mandated under SEBI Circular SEBI/
HO/MIRSD/MIRSD-PoD-1/P/CIR/2023/24 dated February
06, 2023.

As on March 31, 2025, the Board has constituted the following
committees / sub-committees:

• Audit Committee

• Nomination and Remuneration Committee

• Stakeholders'' Relationship Committee

• Finance Committee

• Risk Management Committee

• Corporate Social Responsibility (CSR) Committee

• Environmental, Social and Governance (ESG) Committee

• Independent Directors (ID) Committee

• Information Technology (IT) Committee

• Cyber Security Committee

Details of the above Committees along with terms of reference,
composition and meetings held during the year under review
are disclosed in the Corporate Governance Report which forms
part of this Integrated Annual Report.

ANNUAL EVALUATION OF BOARD''S PERFORMANCE:

Pursuant to the provisions of the Act read with Rules made
thereunder and the Corporate Governance requirements as
prescribed under the Listing Regulations, the Board has carried
out an annual evaluation of its own performance and that of its
Committees and Individual Directors.

The performance of the Board and Individual Directors was
evaluated by the Board seeking inputs from all the Directors.
The performance of the Committees was evaluated based on
their composition, clarity of mandate, frequency of meetings,
and decision-making effectiveness. The Nomination and
Remuneration Committee reviewed the performance of the
Individual Directors. A separate meeting of Independent
Directors was held to review the performance of Non¬
Independent Directors, the Board as a whole and the Chairperson
in line with Schedule IV of the Act. Performance of the Board, its
Committees and Individual Directors was also discussed during
the meeting of the Board of Directors.

The criteria for performance evaluation of the Board included
aspects like Board composition and structure, effectiveness
of Board processes, information and functioning etc. The
criteria for performance evaluation of Committees of the
Board included aspects like composition of Committees,
effectiveness of Committee meetings etc. The criteria for
performance evaluation of the Individual Directors included
aspects on contribution to the Board and Committee meetings
like preparedness on the issues to be discussed, meaningful
and constructive contribution and inputs in meetings etc.

The evaluation process endorsed the Board Members
confidence in the ethical standards of your Company, the
cohesiveness that exists amongst the Board Members, the
two-way open communication between the Board and the

Management and the openness of the Management in sharing
strategic information to enable Board Members to discharge
their responsibilities.

RELATED PARTY TRANSACTIONS:

All related party transactions entered into by the Company
during the financial year were on an arm''s length basis and
in the ordinary course of business. No material contracts or
arrangements with related parties were entered into during the
year under review. Further, there were no transactions for which
consent of the Board was required to be taken in terms of Section
188(1) of the Act and accordingly, no disclosure is required in
respect of the related party transactions in Form AOC-2 under
Section 134(3)(h) of the Act and rules framed thereunder.

During the year, the Audit Committee had granted an omnibus
approval for transactions, which were repetitive in nature
for one financial year. The Audit Committee on a quarterly
basis reviewed all such omnibus approvals. All related party
transactions were placed before the Audit Committee and the
Board for the necessary review and approval, as applicable.
These transactions are supported by a certificate issued by
an Independent Chartered Accountant confirming compliance
with the relevant requirements.

In case of transactions which are unforeseen, the Audit
Committee grants an approval to enter into such unforeseen
transactions provided that the transaction value does not
exceed the limit of '' 1 crore per transaction in a Financial Year.
Your Company has developed and adopted relevant SOPs for the
purpose of monitoring and controlling such transactions. Your
Company''s policy for transactions with the related party which
was reviewed by the Audit Committee and approved by the
Board, can be accessed at https://www.5paisa.com/investor-
relations. The policy on Related Party Transactions was revised
during the year in view of amendments in applicable rules.

Details of Related Party Transactions are set out in Notes to
the Standalone Financial Statements pursuant to IND AS-24.

None of the Directors and the Key Managerial Personnel had any
pecuniary relationships or transactions vis-a-vis the Company
during the year under review, other than those disclosed in the
financial statements.

Pursuant to Regulation 23(9) of the SEBI Listing Regulations,
your Company has filed the reports on related party transactions
with the Stock Exchanges within statutory timelines.

NOMINATION AND REMUNERATION POLICY:

Your Company has in place Nomination and Remuneration
Committee of the Board, which performs the functions as
mandated under the Act, the SEBI Listing Regulations and such
other functions as prescribed by the Board from time to time.
The composition of Nomination and Remuneration Committee,
attendance at its meetings and other details have been provided
as part of the Corporate Governance Report.

The broad objectives of the Nomination and Remuneration
Policy are:

a) To guide the Board in relation to appointment and
removal of Directors, Key Managerial Personnel and
Senior Management;

b) To evaluate the performance of the members of the Board;

c) To recommend to the Board on remuneration payable
to the Directors, Key Managerial Personnel and
Senior Management.

The guiding principles of the Nomination and Remuneration
Policy are to ensure that:

a) Level and composition of remuneration is reasonable and
sufficient to attract, retain and motivate directors of the
quality required to run your Company successfully;

b) Relationship of remuneration to performance is clear and
meets appropriate performance benchmarks; and

c) Remuneration to directors, key managerial personnel and
senior management involves a balance between fixed and
incentive pay reflecting short and long-term performance
objectives appropriate to the working of your Company
and its goals and ensure that the policy is disclosed in the
Board''s report.

In accordance with the Nomination and Remuneration Policy,
the Nomination and Remuneration Committee formulates
the criteria for appointment as a Director, Key Managerial
Personnel and Senior Management, identifies persons who
are qualified to be Directors and nominates candidates for
Directorships subject to the approval of Board, evaluates
the performance of the Individual Directors, recommends to
the Board, remuneration to Managing Director / Whole-time
Directors, ensures that the remuneration to Key Managerial
Personnel, Senior Management and other employees is based
on Company''s overall philosophy and guidelines and is based
on industry standards, linked to performance of the self and
the Company and is a balance of fixed pay and variable pay
and recommends to the Board, sitting fees / commission to
the Non-Executive Directors.

The remuneration has been paid as per the Nomination and
Remuneration Policy of the Company. The Nomination and
Remuneration Policy is available on the website of the Company
at https://www.5paisa.com/investor-relations.

DIRECTORS'' RESPONSIBILITY STATEMENT:

Pursuant to Section 134(3)(c) and 134(5) of the Companies
Act, 2013, the Directors of your Company, to the best of their
knowledge and based on the information and explanations
obtained by them from the Company, confirm that:

a) In the preparation of the annual financial statements
for the financial year ended March 31, 2025, the
applicable accounting standards have been followed
and there are no material departures from the prescribed
accounting standards.

b) 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 your Company
as at March 31, 2025 and of the profit of your Company,
for the said period;

c) 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 your Company and
for preventing and detecting fraud and other irregularities;

d) The annual accounts have been prepared on a "going
concern” basis.

e) The Directors, have laid down proper internal financial
controls to be followed by your Company and that such
internal financial controls are adequate and were operating
effectively; and

f) Proper systems to ensure compliance with the provisions
of all applicable laws were devised and that such systems
were adequate and operating effectively.

STATUTORY AUDITORS:

In accordance with the provisions of Section 139 of the
Companies Act, 2013 and the applicable rules, the members
of the Company, at their 15^th (Fifteenth) Annual General
Meeting, approved the appointment of M/s. V Sankar Aiyar
and Co., Chartered Accountants, Mumbai (Firm Registration
Number: 109208W) as the Statutory Auditors of the Company
for a second term of five (5) years, i.e. from the conclusion of
15^th AGM till the conclusion of 20^th AGM of your Company..

As per the Ministry of Corporate Affairs notification dated
7^th May 2018, the requirement for annual ratification of auditor
appointments has been dispensed with for appointments made
for a five-year term.

The Statutory Auditors have confirmed their compliance with
the independence criteria as prescribed under the Companies
Act, 2013.

Further, the Statutory Auditors have not reported any instance
of fraud to the Audit Committee or the Board of Directors under
Section 143(12) of the Companies Act, 2013 read with Rule 13
of the Companies (Audit and Auditors) Rules, 2014.

Any observations made by the Auditors, if applicable, should be
read in conjunction with the Notes to the Accounts, which are
self-explanatory and do not require further clarification.

MAINTENANCE OF COST RECORDS:

The maintenance of cost records, for the services rendered by
your Company is not required pursuant to Section 148(1) of the
Companies Act, 2013 read with Rule 3 of the Companies (Cost
records and audit) Rules, 2014.

SECRETARIAL AUDITORS:

Pursuant to the provisions of Section 204 of the Companies Act,
2013 read with the Companies (Appointment and Remuneration
of Managerial Personnel) Rules, 2014 and Regulation 24A of the
Listing Regulations, the Board of Directors of the Company had
appointed M/s. Nilesh Shah & Associates, Company Secretaries
in whole-time practice, Mumbai, to conduct Secretarial Audit of
your Company for FY 2024-25.

The Secretarial Auditor, M/s. Nilesh Shah & Associates
conducted the Secretarial Audit of the Company for the
Financial Year 2024-25. Observations made by the said auditor
are mentioned in detail in the Secretarial Audit Report, issued
in prescribed Form MR-3 which is annexed to this report
"Annexure - II" and is self-explanatory. During the year under
review, the Secretarial Auditor has not reported any fraud under
Section 143(12) of the Act and therefore disclosure of details
under Section 134(3)(ca) of the Act is not applicable.

INTERNAL CONTROL SYSTEMS:

a) Internal Audit and its adequacy:

The scope and authority of the internal audit function is
well defined and to maintain independence and objectivity
in its functions, the internal audit function reports directly
to the Audit Committee of the Board.

At the beginning of each Financial Year, a risk-based
annual audit plan is rolled out after it is approved by
the Audit Committee of the Board. The audit plan aims
to evaluate the efficiency and adequacy of the internal
control system(s) and compliance(s) thereof, robustness
of internal processes, policies and accounting procedures,
compliance with laws and regulations. The Internal Audit
function, consisting of professionally qualified chartered
accountants and specialists, is adequately skilled and
resourced to deliver audit assurances at highest levels.

Based on the reports of internal audit function, process
owners undertake corrective action in their respective
areas. Significant audit observations and corrective
actions thereon are presented to the Audit Committee of
the Board.

b) Internal Financial Control Systems and its adequacy:

Your Company has in place adequate internal controls
with reference to financial statements and operations
and the same are operating effectively. The Internal
Auditors tested the design and effectiveness of the key
controls and no material weaknesses were observed in
their examination. Further, Statutory Auditors verified the
systems and processes and confirmed that the Internal
Financial Controls system over financial reporting are
adequate and such controls are operating effectively.

Based on the framework of internal financial controls and
compliance systems established and maintained by your
Company, the work performed by the internal, statutory and

secretarial auditors and external consultants, including the
audit of internal financial controls over financial reporting
by the statutory auditors and the reviews performed
by management and the relevant board committees,
including the Audit committee, the Board is of the opinion
that your Company''s internal financial controls were
adequate and effective during FY 2024-25.

RISK MANAGEMENT:

For your Company, Risk Management is an integral and
important aspect of Corporate Governance. Your Company
believes that a robust Risk Management Framework ensures
adequate controls and monitoring mechanisms for smooth and
efficient running of the business. A risk-aware organization is
better equipped to maximize shareholder value.

The key cornerstones of your Company''s Risk Management
Framework are:

• A well-defined risk management policy;

• Periodic assessment and prioritization of risks that affect
the business of your Company;

• Development and deployment of risk mitigation plans to
reduce vulnerability to prioritized risks;

• Focus on both the results and efforts required to mitigate
the risks;

• Defined review and monitoring mechanism wherein the
functional teams, the top management, Risk Management
Committee, Audit Committee and the Board review the
progress of the mitigation plans;

• Integration of Risk Management with strategic business
plan, annual operating plans, performance management
system and significant business decisions;

• Constant scanning of external environment for new and
emerging risks;

• Wherever applicable and feasible, defining the risk appetite
and implementing adequate internal controls to ensure
that the limits are adhered to.

Your company has constituted a Risk Management Committee
(RMC) chaired by an Independent Director and has also
formulated a Risk Management Policy to identify risks and
mitigate their adverse impact on business which is reviewed
by the Risk Management Committee from time to time.

Risk Management Committee assists the Board in monitoring
and overseeing the implementation of the Risk Management
Policy, including evaluating the adequacy of Risk Management
Systems and such other functions as mandated under the SEBI
Listing Regulations and as the Board may deem fit from time
to time.

The business risks and its mitigation has been reported in detail
in the Management Discussion and Analysis Section forming
part of this Annual Report.

WHISTLE BLOWER POLICY / VIGIL MECHANISM:

Over the years, your Company has established a reputation for
doing business with integrity and displays zero tolerance for
any form of unethical behaviour. To create enduring value for all
stakeholders and ensure the highest level of honesty, integrity
and ethical behaviour in all its operations, your Company has
implemented Vigil Mechanism in the form of Whistle Blower
Policy for Directors and Employees to report their genuine
concerns about misconduct and actual/potential violations, if
any, to the Whistle Officer of the Company.

Pursuant to Section 177 of the Act read with the Rules prescribed
thereunder and Regulation 22 of the Listing Regulations, the
Whistle Blower Policy provides for adequate safeguards against
victimisation of persons who use the Vigil Mechanism. In terms
of the Policy of the Company, no employee of the Company
has been denied direct access to the Chairman of the Audit
Committee of the Board.

The Whistle Blower Policy can be accessed on the website of
the Company at https://www.5paisa.com/investor-relations.

The Audit Committee is also committed to ensure fraud
free work environment. We investigate complaints speedily,
confidentially and in an impartial manner and takes appropriate
action to ensure that the requisite standards of professional
and ethical conduct are always maintained.

Protected disclosures can be made by a whistle-blower through
several channels to report actual or suspected frauds and
violation of the Company''s Code of Conduct. However, during
the year under review, no protected disclosure concerning any
reportable matter in accordance with the Policy of the Company
was received by the Company.

GOING CONCERN STATUS:

Apart from the mentioned below, there were no material orders
passed by the regulators, courts or tribunals, impacting the
going concern status and future operations of your Company.

Multi Commodity Exchange of India Limited ("MCX") vide its
email dated March 14, 2024 ("Order") imposed a restriction
on your Company with regard to onboarding of new clients
across all segments with immediate effect. It was further
intimated that the said restrain shall continue till the Company
submits a complete Root Cause Analysis ("RCA") along with
documentary evidence or for a period of 15 days, whichever
is higher. Basis the action taken by MCX, NSE and BSE also
imposed a similar restriction on your Company vide its email
dated March 14, 2024.

Being aggrieved by the Order, the same was immediately
challenged by your Company before the Hon''ble Bombay
High Court by filing a writ petition. Thereafter, your Company
was given an opportunity of being heard on March 27, 2024
wherein your Company had offered a detailed representation
along with the Root Cause Analysis ("RCA") and Action taken
to ensure non-recurrence of the said issues in future. Despite

the same, the Member and Core Settlement Guarantee Fund
Committee ("MCSGFC") of the MCX passed an order vide its
letter dated July 01, 2024 and levied a monetary penalty of
? 2,59,75,000/- (plus applicable GST) on your company and
further, a non-monetary penalty of restricting on-boarding of
new clients for a period of Fourteen (14) days from the date of
receipt of the order.

Aggrieved by the said order, your company had filed an appeal
against the said order before Hon''ble Securities Appellate
Tribunal ("SAT"). SAT passed an order on July 05, 2024,
granting a stay on the operation of the Impugned order of
MCX subject to deposit of 50% of the penalty amount i.e.
? 1,30,00,000/- (Rupees One Crore Thirty Lakhs Only) within
one week with MCX. Your Company promptly deposited the
said amount with MCX and the restriction, so imposed was
revoked across Exchanges. The matter is currently pending
hearing before the SAT.

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

The information on energy conservation, technology absorption
and foreign exchange earnings and outgo stipulated under
Section 134(3)(m) of the Companies Act, 2013 read with Rule
8 of the Companies (Accounts) Rules, 2014, is appended as
"Annexure - III" to this Directors'' Report.

PARTICULARS OF EMPLOYEES:

Disclosures with respect to the remuneration of Directors,
Key Managerial Personnel and employees as required under
Section 197 of the Act read with Rule 5(1) of the Companies
(Appointment and Remuneration of Managerial Personnel)
Rules, 2014 are given in "Annexure - IV" to this Report. Details of
employee remuneration as required under provisions of Section
197 of the Act read with Rule 5(2) and 5(3) of Companies
(Appointment and Remuneration of Managerial Personnel)
Rules, 2014 also form part of this Report. However, as per the
provisions of Section 136 of the Act, the report and the Audited
Standalone and Consolidated Financial Statements along with
the Auditors'' Report thereon are being sent to the Members and
others entitled thereto, excluding the said information. If any
Member is interested in obtaining a copy thereof, such Member
may write to the Company in this regard.

DISCLOSURE ON SEXUAL HARASSMENT OF WOMAN
AT WORKPLACE:

Your Company recognizes its responsibility to provide equal
opportunities and further it is committed to create a healthy
working environment that enables all the employees to work
with equality and without fear of discrimination, prejudice,
gender bias or any form of harassment at workplace.

To ensure this, your Company has in place, a gender-neutral
policy on prevention of sexual harassment at the workplace
and a framework for employees to report sexual harassment
cases at the workplace where its process ensures complete
anonymity and confidentiality of information. The vigil

mechanism of the Company provides for adequate safeguards
against victimization of Directors, employees and third parties
who avail of the mechanism and provides for direct access
to the Chairman of the Audit Committee in exceptional cases.

All new employees go through a detailed personal orientation on
anti-sexual harassment policy. Additionally, separate trainings
(classroom / online) on Anti-Sexual Harassment Policy are
conducted to educate the employees on said policy / rules.

In compliance with the requirement of the Sexual Harassment
of Women at Workplace (Prevention, Prohibition and Redressal)
Act, 2013 and rules made thereunder, your Company has
constituted Internal Complaints Committee to deal with
complaints relating to sexual harassment at workplace.

Internal Complaints (IC) Committee as on March 31, 2025

Sr. No.	Name	Designation
1.	Namita Godbole	President Officer
2.	Sapna Kshirsagar	IC Member
3.	Jay Parekh	IC Member
4.	Deepak Gupta	IC Member
5.	Rajeshree Jadhav	IC Member
6.	Vasundhara Kaul	External Member

Following are the details of the complaint received by your
company on sexual harassment during FY 2024-25:

• Number of Complaints received during the year: NIL

• Number of Complaints disposed off during the year: NIL

• Number of cases pending for more than 90 days: NIL

• Nature of action taken by employer or district officer:
Not Applicable

CORPORATE SOCIAL RESPONSIBILITY:

Your Company has been at the forefront in helping the
Community through impactful CSR projects that have
addressed critical issues of our time. CSR for a business
includes being responsible for its business processes and
products, and engaging in accountable relationships with its
employees, customers and the community.

Your Company has built its reputation as a good corporate
citizen by not only doing good business, but also by driving
positive change in society. For your Company, CSR is not only
about adhering to statutory and legal compliances but also
creating social and environmental value for its stakeholders
thus contributing to build an equal and future-ready nation.

As per the Companies Act, 2013, as prescribed, companies are
required to spend at least 2% of their average net profits for
three immediately preceding financial years.

Accordingly, during the year, your Company has spent
? 98,16,858/- towards CSR activities during FY 2024-25.

Your company has undertaken CSR activities to promote
education through a project named "Sakhiyon Ki Baadi”,
implemented by the IIFL Foundation.

CSR policy of your Company is available at https://www.5paisa.
com/investor-relations.

The Annual Report on CSR activities is annexed as "Annexure - V"
to this report.

ENVIRONMENT, HEALTH AND SAFETY:

Your Company prioritises protecting, promoting, and enhancing
employee''s wellbeing. Your Company recognises healthy and
safe working conditions as a human right and adheres to all
local and national health and safety regulations.

Given the nature of business, your Company does not
undertake any manufacturing activity. However, the Company
has designed and adopted manuals and procedures to cover
environmental aspects and health and safety risks that the
facility / property can control and directly manage and those
that it does not directly control or manage but over which it
can be expected to have an influence through its Environment,
Health and Safety Manual.

Your Company is sensitive about the health and safety of its
employees and has been achieving continuous improvement
in safety performance through a combination of systems and
processes as well as co-operation and support of all employees.

INDUSTRIAL RELATIONS:

The Company maintained healthy, cordial and harmonious
industrial relations at all levels during the year. The Board
acknowledges the contribution of the employees and all other
stakeholders towards meeting the objectives of the Company.

ANNUAL RETURN:

As per the requirements of Section 92(3) of the Act and Rule
12 of the Companies (Management and Administration) Rules,
2014, the Annual Return of your Company is available on your
company''s corporate website at https://www.5paisa.com/
investor-relations.

CODE OF CONDUCT:

Your Company has implemented a Code of Conduct applicable
to its Board of Directors and senior management personnel,
embodying the legal and ethical standards to which the
Company is firmly committed.

All Directors and senior management personnel have adhered
to the provisions of this Code. They have also submitted their
annual affirmation of compliance with the Code for the financial
year ended March 31,2025. The Code of Conduct is available on
the Company''s website at https://www.5paisa.com/investor-
relations.

GENERAL CONFIRMATIONS:

1. There has been no change in the nature of business of
your Company during the Financial Year 2024-25.

2. The notes on the financial statement referred in the
Auditor''s Report are self-explanatory and do not call for
any further comments. The Auditor''s Report does not
contain any qualification, reservation, adverse remark or
disclaimer for the Financial Year 2024-25.

3. There have been no instances of frauds reported by the
Auditors under Section 143(12) of the Act and the Rules
framed thereunder, either to the Company or to the
Central Government.

4. Your Company is fully compliant with the applicable
Secretarial Standards (SS) issued by Institute of Company
Secretaries of India viz. SS-1 and SS-2 on Meetings of the
Board of Directors and General Meetings respectively.

5. Neither the Managing Director nor the Whole-time
Directors of the Company receive any remuneration or
commission from any of its subsidiaries;

6. There was no instance of one-time settlement of loan
obtained from the Banks or Financial Institutions.

GENERAL DISCLOSURES:

The Directors states that there being no transactions with
respect to the following items during the financial year 2024-25,
no disclosure or reporting is required with respect to the same:

1. Issue of equity shares with differential rights as to dividend,
voting or otherwise.

2. Buyback of shares.

3. Receipt of any remuneration or commission by the
Director(s) of your Company from any of its subsidiaries.

4. Material changes and commitments affecting the financial
position of your Company that have occurred between the
end of the financial year to which the financial statements
relate and the date of this report, unless otherwise stated
in the report.

5. Application or proceedings made under the Insolvency and
Bankruptcy Code, 2016.

CAUTIONARY STATEMENT:

Statements in the Annual Report, including those which relate
to Management Discussion and Analysis, describing your
Company''s objectives, projections, estimates and expectations,
may constitute "forward looking statements” within the
meaning of applicable laws and regulations. Although the
expectations are based on reasonable assumptions, the actual
results might differ.

APPRECIATION:

Your directors place on record their sincere appreciation for
the assistance and guidance provided by the Government,
Regulators, Stock Exchanges, Depositories, other statutory
bodies and your Company''s Bankers for the assistance, co¬
operation and encouragement extended to your Company.

Your 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 employees of your Company
are instrumental for the Company scaling new heights, year
after year. Their commitment and contribution is deeply
acknowledged. Your involvement as members is also greatly
valued. Your Directors look forward to your continuing support.

For and on behalf of the Board of Directors
5paisa Capital Limited

Gaurav Seth Gourav Munjal

Managing Director Whole Time Director and

and Chief Executive Officer Chief Financial Officer

DIN: 10415364 DIN: 06360031

Date: July 08, 2025
Place: Thane

---

Mar 31, 2024

The Directors take pleasure in presenting their Seventeenth (17^th) Annual Report on the business and operations of your Company ("5paisa Capital", "Your Company", "We") along with the Audited Financial Statements for the Financial Year ended March 31, 2024 ("year under review" or "year" or "FY 2023-24"). The consolidated performance of your Company and its subsidiaries has been referred to wherever required.

(Rs. In Millions)
Particulars	Consolidated		Standalone
	FY 2023-24	FY 2022-23	FY 2023-24	FY 2022-23
Gross total income	3 ,947.36	3,393.68	3,945.58	3,381.47
Profit/(Loss) before interest, depreciation and taxation	1102.27	875.16	1067.06	864.29
Interest and financial charges	285.68	206.34	285.68	206.34
Depreciation	95.33	87.94	94.71	80.40
Profit/(Loss) before tax	721.26	580.89	686.67	577.55
Taxation-Current	195.28	83.18	195.28	82.91
- Deferred	(18.43)	62.05	(27.14)	61.67
- Short or excess provision for income tax	-	-	-	-
Net profit/(Loss) for the year	544.41	435.67	518.53	432.97
Less: Appropriations	-	-	-	-
Add: Balance brought forward from the previous year	79.77	(355.89)	114.69	(318.28)
Balance to be carried forward	624.18	79.77	633.22	114.69

In compliance with the applicable provisions of the Companies Act, 2013 ("the Act") (including any statutory modification(s) or re-enactment(s) thereof, for the time being in force and the Securities and Exchange Board of India (Listing Obligations

Note(s):

1. Previous periods’ figures have been regrouped/ rearranged wherever necessary.

2. Figures in brackets represent deduction(s).

The statement containing extract of subsidiaries financial statement are provided on the corporate website at https:// www.5paisa.com/investor-relations.

CONSOLIDATED FINANCIAL STATEMENTS:

The Consolidated Financial Statements of your Company for the FY 2023-24 are prepared in compliance with the applicable provisions of the Companies Act, 2013 ("the Act"), Indian Accounting Standards ("Ind AS") and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("the Listing Regulations"). The Consolidated Financial Statements have been prepared on the basis of Audited Financial Statements of the Company

and Disclosure Requirements) Regulation, 2015 ("the Listing Regulations"), this report covers the financial performance and other developments during the Financial Year 2023-24 and upto the date of the Board Meeting held on July 12, 2024 to approve this report in respect of 5paisa Capital Limited on a standalone basis as well as on a consolidated basis comprising of 5paisa Capital Limited and its Subsidiaries.

FINANCIAL HIGHIGHTS:

Your Company’s Standalone and Consolidated financial performance during Financial Year 2023-24, as compared with that of the previous Financial Year 2022-23 is summarized below: and its subsidiaries, approved by their respective Board of Directors.

Copies of the Balance Sheet, Statement of Profit & Loss, Report of the Board of Directors and Report of the Auditors of the subsidiary companies are not attached to the accounts of your Company for the financial year 2023-24. Your Company will arrange for soft copies of these documents/details upon request by any member of the Company and dispatch the same on the registered email address of the member.

These documents/details will also be available for inspection by any member of your Company at its registered office and at the registered offices of the concerned subsidiary during the business hours on working days i.e. except on Saturdays, Sundays and Public Holidays. If any member is interested in obtaining a copy thereof, such member may write to the Company Secretary, whereupon a soft copy of the same would be sent to the registered email address of the member. The Annual Report of subsidiaries is uploaded on our corporate

website at https://www.5paisa.com/investor-relations. As required by Companies Act, 2013 and Accounting Standard -21 (AS 21) issued by the Institute of Chartered Accountants of India, your Company’s Consolidated Financial Statements included in this Annual Report incorporate the accounts of its subsidiaries. A report on the performance and financial position of the subsidiaries is provided in the prescribed form AOC-1 as "Annexure-I" to this Directors’ Report.

The policy on determining the material subsidiary is available on our corporate website: https://storaae.aooaleapis. com/5paisa-prod-storaae/files/investor relations/2021-05/ policy-on-determining-material-subsidiary.pdf

REVIEW OF BUSINESS AND OPERATIONS AND STATE OF YOUR COMPANY''S AFFAIRS:

Over the next ten years, there will be major megatrends in the Indian capital markets that will fundamentally alter the financial landscape. The increasing digitisation of financial services is a significant trend, as evidenced by growing retail participation in the markets. Younger generations, in particular, are becoming more financially aware and are entering the stock markets at an early age. Their preference for digital platforms and self-directed investments will influence newer developments in the products and services offered by brokers. The increasing recognition of environmental, social, and governance (ESG) factors will lead to a growing demand for ESG-compliant investment options, driving the industry to offer products that align with sustainable and responsible investing principles.

Higher integration and adoption of technology in financial services, such as AI, blockchain, and robo-advisory services, will further drive efficiency and personalization in the broking industry. Algorithmic trading is expected to grow substantially, as more traders and institutions leverage advanced algorithms and AI to execute trades at high speeds and lower costs. Amidst the rapid pace of these changes, the Indian regulatory environment is also expected to evolve and place greater emphasis on transparency, compliance and investor protection while maintaining the stability and openness of the capital markets. Together, these major trends portend ten years of inclusion, sustainability and innovation in the Indian capital markets.

Your Company has improved its financial performance by offering investors a digital platform with a range of features that enables them to learn more about the financial world, make informed decisions, invest through its mobile application and increase their participation and profits from the financial market. The revenue this year stood at '' 395 crore as against ''339 crore in FY23, an increase of 16% YoY. The Company earned a net profit after tax of ''54 crore, a growth of 25% on YoY basis. This is due to the Company’s dedication to meeting the needs of its esteemed customers, its consistent efforts to build the right teams and culture and its integration of innovation, technology and sustainability at the heart of its operations.

Read more about your company’s performance during the year on page 137 of the Annual Report of the company.

Throughout the year, your company concentrated on using technology to improve customer experience, expanded cohort-based personalized service offerings, developed the Algo and API ecosystem and fortified strategic partnerships to drive innovation and market expansion. Consequently, your company has solidified its standing as a major participant in the discount broking market by providing exceptional services and delivering value to all its stakeholders.

MACRO-ECONOMIC OVERVIEW:

Read more about your company’s performance during the year on page 137 of Annual Report of the company.

INDUSTRY OVERVIEW:

Read more about your company’s performance during the year on page 137 of the Annual Report of the company.

KEY DEVELOPMENTS:

Scheme of Arrangement between IIFL Securities Limited ("Demerged Company") and 5paisa Capital Limited ("Resulting Company") and their respective shareholders and creditors.

The Board of Directors at their meeting held on December 06, 2022 had approved the Scheme of Arrangement between the Company and IIFL Securities Limited and their respective shareholders and creditors which inter alia provided for the demerger of the Online Retail Trading Business of IIFL Securities Limited into the Company.

However, considering the substantial change in the business environment and overall impact of change in business environment, the Board of Directors, in the interest of the Company and its Stakeholders, withdrew the proposed scheme by passing a Circular Resolution of Board of Directors of the Company dated January 22, 2024.

RETURN TO INVESTORS (DIVIDEND):

In order to conserve the resources of your Company for future expansion, the Directors have decided not to recommend any dividend on equity shares of your Company for the financial year under review.

The Dividend Distribution Policy is available on the website at https://storaae.aooaleapis.com/5paisa-prod-storaae/flles/ investor relations/2022-04/Dividend%20Distribution%20 Policy 1.pdf

TRANSFER TO GENERAL RESERVE:

During the year under review, your Company has not transferred any amount to the reserves.

TRANSFER OF FUNDS TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF):

Pursuant to the provisions of Section 124 and 125 of the Companies Act, 2013 ("Act") read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("IEPF Rules"), all unpaid or unclaimed

dividends are required to be transferred by your Company to the Investor Education and Protection Fund ("IEPF" or "Fund") Account established by the Central Government, after completion of seven years from the date the dividend is transferred to unpaid/unclaimed account. Further, according to the Rules, the shares in respect of which dividend has not been paid or claimed by the members for seven consecutive years or more shall also be transferred to the demat account created by the IEPF Authority after complying with the procedure laid down under the Rules.

During FY 2023-24, your company had not transferred any shares to ''IEPF'' Account.

However, as on the March 31,2024, '' 0.18 million is lying as the unclaimed fractional entitlements in the unpaid fractional shares account.

AWARDS AND RECOGNITION:

During the year under review, your Company received numerous awards and accolades which were conferred by reputable organizations and is designed to honor the efforts made by us and the details of the same are given herein below:

• India Content Leadership Awards 2023, Inkspell

Best Content in a Financial Services App.

• India Content Leadership Awards 2023, Inkspell

Best Financial Content on Social Platform(s).

• Masters of Modern Marketing Awards 2023, Inkspell

Multi Channel campaign for a Financial Services

Enterprise - Special Mention 5paisa.

• MCX Awards 2023

Leading Member - Client Participation

SHARE CAPITAL:

The paid up equity share capital of your Company as on March 31,2024 was '' 31,19,09,730/- divided into 3,11,90,973 Equity Shares of '' 10/- each as compared to '' 30,63,55,680/- divided into 3,06,35,568 Equity Shares of '' 10/- each as on March 31, 2023.

The increase in the share capital was on account of exercise of 5,55,405 ESOPs granted under the 5paisa Capital Limited Employee Stock Option Scheme 2017, by eligible employees, which were converted into equity shares '' 10/- each.

EMPLOYEES STOCK OPTION SCHEMES ("ESOS"):

The Employees'' Stock Option Schemes enable your Company to hire and retain the best talent for its senior management and key positions. The Nomination and Remuneration Committee of the Board of Directors of your Company, inter alia, administers and monitors the Employees'' Stock Option Schemes in accordance with the applicable SEBI Regulations.

ESOS of your Company are in line with SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021

("SBEBSE Regulations"). The Members at their 16^th Annual General Meeting held on August 31,2023 had approved 5paisa Capital Limited Employee Stock Option Scheme 2023 ("5PCL ESOS 2023") pursuant to which, your Company, presently, has three Schemes:

1) 5paisa Capital Limited Employee Stock Option Scheme 2017 ("5PCL ESOS 2017") was approved by shareholders vide special resolution dated January 25, 2018.

2) 5paisa Capital Limited Employee Stock Option Trust Scheme 2017 ("5PCL ESOTS 2017") was approved by shareholders vide special resolution dated January 25, 2018.

3) 5paisa Capital Limited Employee Stock Option Scheme 2023 ("5PCL ESOS 2023") was approved by shareholders vide special resolution dated August 31,2023.

As per Regulation 14 of "SBEBSE Regulations", the details of the "ESOS" are disclosed on our corporate website which can be accessed at https://www.5paisa.com/investor-relations.

A certificate from the secretarial auditors of the Company stating that the aforesaid schemes have been implemented in accordance with the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 and in accordance with the resolution passed by the members shall be placed at the ensuing Annual General Meeting for inspection by members.

INCREASE IN SIZE OF ESOP POOL:

Pursuant to the recommendation of the Nomination and Remuneration Committee, the Board of Directors at their meeting held on November 10, 2023, approved the increase in size of ESOP Pool for grant of options to eligible employees under the Employee Stock Option Scheme-2017 from 22,00,000 (Twenty-two Lakhs) to 40,00,000 (Forty Lakhs) options convertible into equity shares of '' 10/- each of the Company. Further, the members vide Special Resolution dated December 22, 2023 passed through Postal Ballot approved the same.

PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE, GUARANTEES GIVEN AND SECURITIES PROVIDED UNDER SECTION 186 OF THE COMPANIES ACT, 2013:

Particulars of loans given, investments made, guarantees given and securities provided as covered under the provisions of Section 186 of the Act are set out in the notes to the accompanying financial statements of your Company.

DEPOSITS:

During the year under review, your Company has not accepted any deposits from the public falling under the ambit of Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014. Therefore, payment on the account of principal or interest amount on deposits from the public does not arise.

SUBSIDIARIES:

• 5paisa P2P Limited

5paisa P2P Limited is a wholly owned subsidiary of 5paisa Capital Limited. The company received Certificate of Registration from Reserve Bank of India ("RBI") bearing registration number N-13.02371 to act as NBFC P2P

• 5paisa Corporate Services Limited (Formerly known as 5paisa Insurance Brokers Limited)

5paisa Corporate Services Limited (Formerly known as 5paisa Insurance Brokers Limited) is a wholly owned subsidiary of 5paisa Capital Limited incorporated on October 27, 2018. The name of the company was changed from ''5paisa Insurance Brokers Limited’ to ''5paisa Corporate Services Limited’ with effect from November 16, 2022 pursuant to receipt of fresh Certificate of Incorporation dated November 16, 2022 issued by the Registrar of Companies, Mumbai. The Company shall commence its business shortly.

• 5paisa Trading Limited

5paisa Trading Limited was incorporated as a public limited company on February 27, 2020 as a wholly owned subsidiary of 5paisa Capital Limited.

• 5paisa International Securities (IFSC) Limited

5paisa International Securities (IFSC) Limited was incorporated as a public limited company on June 15, 2022 as a wholly owned subsidiary of 5paisa Capital Limited. 5paisa International Securities (IFSC) Limited is incorporated with the object of carrying out business of IFSC (International Financial Service Centre) Unit and act as intermediary in IFSC. The Company shall commence its operations after receipt of necessary clearances/ licenses.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

Management Discussion and Analysis Report for the year under review, as stipulated under the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), is presented in a separate section, forming part of the Annual Report.

CORPORATE GOVERNANCE:

Your Company is committed to transparency in all its dealings and places high emphasis on business ethics. It has put in place an effective Corporate Governance system which ensures that provisions of the Act and Listing Regulations are duly complied with, not only in form but also in substance.

A Report on Corporate Governance along with a Certificate from the Statutory Auditors of the Company confirming corporate governance requirements as stipulated under the Listing Regulations forms an integral part of this Annual Report.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT:

Regulation 34 of the Listing Regulations mandates for the top 1000 listed companies to submit Business Responsibility and Sustainability Report with effect from financial year 202223. For Business Responsibility and Sustainability Report as stipulated under Regulation 34 of the Listing Regulations, kindly refer to Business Responsibility and Sustainability Report section which forms part of this Annual Report.

BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL:

5paisa actively seeks to adopt best global practices for an effective functioning of the Board and believes in having a truly diverse Board whose wisdom and strength can be leveraged for creating greater stakeholder value, protection of their interests and better corporate governance. Your Company’s Board comprises of eminent persons with proven competence and integrity, who bring in vast experience and expertise, strategic guidance and leadership qualities.

1. Composition of Board of Directors:

The composition of the Board of Directors of the Company is in accordance with the provisions of Section 149 of the Act and Regulation 17 of the Listing Regulations, with an appropriate combination of Executive, Non-Executive and Independent Directors.

As on the date of this Boards Report i.e. as on July 12, 2024, your Company’s Board of Directors comprises of following Directors:

Name of the DIN Designation

Director

Dr. Archana 00028037 Non - Executive

Hingorani Independent Director

and Chairperson

Mr. Narayan 09298665 Managing Director &

Gangadhar Chief Executive Officer

Mr. Gourav 06360031 Whole Time Director &

Munjal Chief Financial Officer

Mr. Milin 01297508 Non - Executive

Mehta Independent Director

Mr. Ravindra 00984163 Non - Executive

Garikipati Independent Director

Ms. Nirali 00319389 Non - Executive

Sanghi Independent Director

2. Changes in Board Composition:

As a measure of enhanced corporate governance and increased Board effectiveness, the Board, based on the recommendation of the Nomination and Remuneration Committee ("NRC"), appointed Mr. Narayan Gangadhar (DIN: 09298665), incumbent Chief Executive Officer of the Company, as the Managing Director for a term of five years (5) with effect from July 13, 2023.

Mr. Prakarsh Gagdani (DIN: 07376258) stepped down as the Whole Time Director & Chief Business Officer of the Company with effect from closure of business hours of December 31, 2023, to pursue career opportunities outside the organization. The Board places on record its appreciation for the guidance and support provided by Mr. Prakarsh Gagdani during his association with the Company.

There was no change in the composition of the Board of Directors during the year under review, except as stated above.

3. Key developments in the Board Composition pursuant to the conclusion of the financial year:

In order to pursue additional responsibilities as a Strategic Advisor to the IIFL group in their new initiatives towards Artificial Intelligence and Digital Transformation, Mr. Narayan Gangadhar (DIN: 09298665), vide his letter dated May 30, 2024 resigned from the post of Managing Director and Chief Executive Officer (CEO) of the Company and the said resignation was accepted by the Board vide Circular Resolution dated May 30, 2024. The said resignation shall be effective from the close of business hours of August 28, 2024.

Consequently, he also ceased to be the Member of the Risk Management Committee, Stakeholder Relationship Committee, Corporate Social Responsibility (CSR) Committee, Finance Committee, Environmental, Social and Governance (ESG) Committee, Information Technology (IT) Committee and Cyber Security Committee of the Company.

Further, the Board of Directors, based on the recommendation of Nomination & Remuneration (NRC) Committee, at their meeting held on Friday, July 12, 2024 appointed Mr. Ameya Agnihotri (DIN: 07680132) as Additional Director designated as Whole Time Director of the Company w.e.f. July 13, 2024. The Board has recommended for approval of Members, appointment of Mr. Ameya Agnihotri as Whole-time Director of the Company at the ensuing AGM. Brief profile and other information in this regard forms part of AGM Notice.

4. Retirement by Rotation:

Mr. Gourav Munjal (DIN: 06360031), Whole-time Director & Chief Financial Officer of your Company, retires by rotation at the 17^th Annual General Meeting of the Company and being eligible has offered himself for reappointment. Based on the recommendation of the Nomination and Remuneration Committee, the Board has recommended for approval of Members, re-appointment of Mr. Gourav Munjal as Whole-time Director of the Company at the ensuing AGM. Brief profile and other information in this regard forms part of AGM Notice.

5. Key Managerial Personnel:

Pursuant to the provisions of Section 2(51) and Section 203 of the Companies Act, 2013 and rules made thereunder, the Key Managerial Personnel of your Company as on March 31,2024 are:

Mr. Narayan Gangadhar : Managing Director & Chief Executive Officer

Mr. Gourav Munjal : Whole-Time Director & Chief Financial Officer

Mrs. Namita Godbole : Company Secretary & Chief Compliance Officer

The Remuneration and other details of the Key Managerial Personnel for the year ended March 31,2024 are mentioned in Form MGT-7 - Annual Return which can be accessed on our corporate website at https:// www.5paisa.com/investor-relations.

Further, pursuant to SEBI Circular No. SEBI/HO/MIRSD/ MIRSD-PoD-l/P/CIR/2023/24 dated February 06, 2023, your company has recognized and has designated following senior officers as a Key Managerial Personnel of your company for managing the key risks.

Mrs. Namita Godbole : Chief Compliance Officer

Mr. Yogesh Maroli : Chief Information Security Officer

6. Independent Directors:

The Independent Directors have been familiarized with the Company, their roles, rights and responsibilities in the Company. The details of Familiarization Programmes are available on the website of the Company at https:// storage.googleapis.com/5paisa-prod-storage/files/ investor relations/2024-08/Familiarization%20 Programme 5paisa%20Capital%20Limited.pdf

The Company has received requisite declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence prescribed under Section 149(6) of the Act read with Rule 5 of the Companies (Appointment and Qualification of Directors) Rules, 2014 and Regulation 16(1)(b) of the SEBI Listing Regulations. The Independent Directors have also confirmed that they are not aware of any circumstance or situation that exists 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. This has been noted by the Board of Directors.

In the opinion of the Board, all the Independent Directors satisfy the criteria of independence as defined under the Act, rules framed thereunder and the SEBI Listing Regulations, and that they are independent of the

Management of the Company. In the opinion of the Board, all Independent Directors (including those appointed during the year) possess requisite qualifications, experience, expertise, proficiency and hold high standards of integrity for the purpose of Rule 8(5)(iiia) of the Companies (Accounts) Rules, 2014. In terms of the requirements under the SEBI Listing Regulations, the Board has identified list of key skills, expertise and core competencies of the Board, including the Independent Directors, details of which are provided as part of the Corporate Governance Report.

As required under Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, all the Independent Directors (including those appointed during the year) have registered themselves with the Independent Directors Databank and completed the online proficiency test conducted by the Indian Institute of Corporate Affairs, wherever required.

BOARD MEETINGS:

During the year, Six (6) Board Meetings were convened and held on May 01,2023, May 24, 2023, July 12, 2023, October 18, 2023, November 10, 2023 & January 11,2024. The particulars of attendance of the Directors at the said meetings are detailed in the Corporate Governance Report of the Company, which forms part of this Report. The intervening gap between the Meetings was within the period prescribed under the Act and Listing Regulations.

MEETING OF INDEPENDENT DIRECTORS:

The Independent Directors of your Company meet atleast once during the year, without the presence of Executive Director or other Non-Independent Directors. These meetings are conducted in an informal and flexible manner to enable the Independent Directors to discuss matters pertaining to, inter alia, review of performance of Non-Independent Directors and the Board as a whole, assess the quality, quantity and timeliness of flow of information between the Company Management and the Board that is necessary for the Board to effectively and reasonably perform its duties. One such meeting was held during the year on March 28, 2024.

COMMITTEES OF THE BOARD:

Your Company has constituted various Board level committees in accordance with the requirements of the Act and the Listing Regulations. Further, the Company being categorized as Qualified Stock Broker (QSB) has also constituted other additional committees as required under the SEBI Circular SEBI/HO/MIRSD/MIRSD-PoD-1/P/CIR/2023/24 dated February 06, 2023

Following are the Committees constituted by the Board:

• Audit Committee

• Nomination and Remuneration Committee

• Stakeholders Relationship Committee

• Finance Committee

• Risk Management Committee

• Corporate Social Responsibility (CSR) Committee

• Environmental, Social and Governance (ESG) Committee

• Independent Directors (ID) Committee

• Information Technology Committee

• Cyber Security Committee

Details of the above Committees along with composition and meetings held during the year under review are provided in the Corporate Governance Report forming part of this Report.

ANNUAL EVALUATION OF BOARD''S PERFORMANCE:

Pursuant to the provisions of the Act read with Rules made thereunder and the Corporate Governance requirements as prescribed under the Listing Regulations, the Board has carried out an annual evaluation of its own performance and that of its Committees and Individual Directors.

The performance of the Board and Individual Directors was evaluated by the Board seeking inputs from all the Directors. The performance of the Committees was evaluated by the Board seeking inputs from the Committee Members. The Nomination and Remuneration Committee reviewed the performance of the Individual Directors. A separate meeting of Independent Directors was held to review the performance of Non-Independent Directors, performance of the Board as a whole and performance of the Executive Directors of the Company. Performance of the Board, its Committees and Individual Directors was also discussed during the meeting of the Board of Directors.

The criteria for performance evaluation of the Board included aspects like Board composition and structure, effectiveness of Board processes, information and functioning etc. The criteria for performance evaluation of Committees of the Board included aspects like composition of Committees, effectiveness of Committee meetings etc. The criteria for performance evaluation of the Individual Directors included aspects on contribution to the Board and Committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings etc.

The evaluation process endorsed the Board Members confidence in the ethical standards of your Company, the cohesiveness that exists amongst the Board Members, the two-way open communication between the Board and the Management and the openness of the Management in sharing strategic information to enable Board Members to discharge their responsibilities.

RELATED PARTY TRANSACTIONS:

All related party transactions entered into by the Company during the financial year were conducted at an arm’s length basis. No material contracts or arrangements with related

parties were entered into during the year under review. Further, there were no transactions for which consent of the Board was required to be taken in terms of Section 188(1) of the Act and accordingly, no disclosure is required in respect of the related party transactions in Form AOC-2 under Section 134(3)(h) of the Act and rules framed thereunder.

During the year, the Audit Committee had granted an omnibus approval for transactions, which were repetitive in nature for one financial year. The Audit Committee on a quarterly basis reviewed all such omnibus approvals. All related party transactions were placed at the meetings of Audit Committee and of the Board of Directors for the necessary review and approval. The statement is supported by a certificate from the Independent Chartered Accountant.

In case of transactions which are unforeseen, the Audit Committee grants an approval to enter into such unforeseen transactions provided that the transaction value does not exceed the limit of 1 crore per transaction in a Financial Year. Your Company has developed and adopted relevant SOPs for the purpose of monitoring and controlling such transactions. Your Company’s policy for transactions with the related party which was reviewed by the Audit Committee and approved by the Board, can be accessed at https://storage.googleapis. com/5paisa-prod-storage/files/investor relations/2022-04/ RPT Policy-Version-2.1-Final%20%282%29 0.pdf

Details of Related Party Transactions are set out in Notes to the Standalone Financial Statements.

None of the Directors and the Key Managerial Personnel has any pecuniary relationships or transactions vis-a-vis the Company.

Pursuant to Regulation 23(9) of the SEBI Listing Regulations, your Company has filed the reports on related party transactions with the Stock Exchanges within statutory timelines.

NOMINATION AND REMUNERATION POLICY:

Your Company has in place Nomination and Remuneration Committee of the Board, which performs the functions as mandated under the Act, the SEBI Listing Regulations and such other functions as prescribed by the Board from time to time. The composition of Nomination and Remuneration Committee, attendance at its meetings and other details have been provided as part of the Corporate Governance Report.

The broad objectives of the Nomination and Remuneration Policy are:

a) to guide the Board in relation to appointment and removal of Directors, Key Managerial Personnel and Senior Management;

b) to evaluate the performance of the members of the Board;

c) to recommend to the Board on remuneration payable to the Directors, Key Managerial Personnel and Senior Management.

The guiding principles of the Nomination and Remuneration Policy are to ensure that:

a) Level and composition of remuneration is reasonable and sufficient to attract, retain and motivate directors of the quality required to run your Company successfully;

b) Relationship of remuneration to performance is clear and meets appropriate performance benchmarks; and

c) Remuneration to directors, key managerial personnel and senior management involves a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of your Company and its goals and ensure that the policy is disclosed in the Board’s report.

In accordance with the Nomination and Remuneration Policy, the Nomination and Remuneration Committee formulates the criteria for appointment as a Director, Key Managerial Personnel and Senior Management, identifies persons who are qualified to be Directors and nominates candidates for Directorships subject to the approval of Board, evaluates the performance of the Individual Directors, recommends to the Board, remuneration to Managing Director/Whole-time Directors, ensures that the remuneration to Key Managerial Personnel, Senior Management and other employees is based on Company’s overall philosophy and guidelines and is based on industry standards, linked to performance of the self and the Company and is a balance of fixed pay and variable pay and recommends to the Board, sitting fees/commission to the Non-Executive Directors.

The remuneration has been paid as per the Nomination and Remuneration Policy of the Company. The Nomination and Remuneration Policy is available on the website of the Company at https://storage.googleapis.com/5paisa-prod-storage/files/investor relations/2021-04/nomination-and-remuneration-policy.pdf

DIRECTORS'' RESPONSIBILITY STATEMENT:

Pursuant to Section 134(3)(c) and 134(5) of the Companies Act, 2013, the Directors of your Company, to the best of their knowledge and based on the information and explanations received from the Company confirm that:

a) In the preparation of the annual financial statements for the financial year ended March 31, 2024, the applicable accounting standards have been followed and there are no material departures from the same.

b) 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 your Company as at March 31,2024 and of the profit of your Company for the said period;

c) Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) The annual accounts have been prepared on a ''going concern’ basis.

e) Proper internal financial controls to be followed by the Company were laid down and such internal financial controls are adequate and were operating effectively; and

f) Proper systems to ensure compliance with the provisions of all applicable laws were devised and that such systems were adequate and operating effectively.

STATUTORY AUDITORS:

As per Section 139 of the Companies Act, 2013, read with Companies (Audit and Auditors) Rules, 2014, the members of your Company in its 15^th AGM of the Company approved the re-appointment of M/s. V Sankar Aiyar & Co., Chartered Accountants, Mumbai (Firm Registration Number: 109208W), as the Statutory Auditors of your Company for a term of five consecutive years i.e. from the conclusion of 15^th AGM till the conclusion of 20^th AGM of your Company.

MAINTENANCE OF COST RECORDS:

The maintenance of cost records, for the services rendered by your Company is not required pursuant to Section 148(1) of the Companies Act, 2013 read with Rule 3 of the Companies (Cost records and audit) Rules, 2014.

SECRETARIAL AUDITORS:

Pursuant to the provisions of Section 204 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 read with Regulation 24A of the Listing Regulations, the Board of Directors of the Company had appointed M/s. Nilesh Shah & Associates, Company Secretaries in whole-time practice, Mumbai, to conduct Secretarial Audit of your Company for the Financial Year 2023-24.

The Secretarial Auditor, M/s. Nilesh Shah & Associates, conducted the Secretarial Audit of the Company for the Financial Year 2023-24. Observations made by the said auditor are mentioned in detail in the Secretarial Audit Report, issued in prescribed Form MR-3 which is annexed to this report ("Annexure-II") and is self-explanatory. During the year under review, the Secretarial Auditor has not reported any fraud under Section 143(12) of the Act and therefore disclosure of details under Section 134(3)(ca) of the Act is not applicable.

INTERNAL CONTROL SYSTEMS:

a) Internal Audit and its adequacy

The scope and authority of the internal audit function is well defined and to maintain independence and objectivity in its functions, the internal audit function reports directly to the Audit Committee of the Board.

At the beginning of each Financial Year, a risk-based annual audit plan is rolled out after it is approved by the Audit Committee of the Board. The audit plan aims to evaluate the efficiency and adequacy of the internal control system(s) and compliance(s) thereof, robustness of internal processes, policies and accounting procedures, compliance with laws and regulations. The Internal Audit function, consisting of professionally qualified chartered accountants and specialists, is adequately skilled and resourced to deliver audit assurances at highest levels.

Based on the reports of internal audit function, process owners undertake corrective action in their respective areas. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board.

b) Internal Financial Control Systems and its adequacy

Your Company has in place adequate internal controls with reference to financial statements and operations and the same are operating effectively. The Internal Auditors tested the design and effectiveness of the key controls and no material weaknesses were observed in their examination. Further, Statutory Auditors verified the systems and processes and confirmed that the Internal Financial Controls system over financial reporting are adequate and such controls are operating effectively.

Based on the framework of internal financial controls and compliance systems established and maintained by your Company, the work performed by the internal, statutory and secretarial auditors and external consultants, including the audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by management and the relevant board committees, including the Audit committee, the Board is of the opinion that your Company’s internal financial controls were adequate and effective during FY 2023-24.

RISK MANAGEMENT:

For your Company, Risk Management is an integral and important aspect of Corporate Governance. Your Company believes that a robust Risk Management Framework ensures adequate controls and monitoring mechanisms for smooth and efficient running of the business. A risk-aware organization is better equipped to maximize shareholder value.

The key cornerstones of your Company’s Risk Management Framework are:

• A well-defined risk management policy;

• Periodic assessment and prioritization of risks that affect the business of your Company;

• Development and deployment of risk mitigation plans to reduce vulnerability to prioritized risks;

• Focus on both the results and efforts required to mitigate the risks;

• Defined review and monitoring mechanism wherein the functional teams, the top management, the Risk Management Committee, Audit Committee and the Board review the progress of the mitigation plans;

• Integration of Risk Management with strategic business plan, annual operating plans, performance management system and significant business decisions;

• Constant scanning of external environment for new and emerging risks;

• Wherever applicable and feasible, defining the risk appetite and implementing adequate internal controls to ensure that the limits are adhered to.

Your company has constituted a Risk Management Committee (RMC) chaired by an Independent Director and has also formulated a Risk Management Policy to identify risks and mitigate their adverse impact on business which is reviewed by the Risk Management Committee from time to time.

Risk Management Committee assists the Board in monitoring and overseeing the implementation of the Risk Management Policy, including evaluating the adequacy of Risk Management Systems and such other functions as mandated under the SEBI Listing Regulations and as the Board may deem fit from time to time.

The business risks and its mitigation has been reported in detail in the Management Discussion and Analysis Section forming part of this Annual Report.

WHISTLE BLOWER POLICY/VIGIL MECHANISM:

Over the years, your Company has established a reputation for doing business with integrity and displays zero tolerance for any form of unethical behaviour. To create enduring value for all stakeholders and ensure the highest level of honesty, integrity and ethical behaviour in all its operations, your Company has implemented Vigil Mechanism in the form of Whistle Blower Policy for Directors and Employees to report their genuine concerns about misconduct and actual/potential violations, if any, to the Whistle Officer of the Company.

Pursuant to Section 177 of the Act read with the Rules prescribed thereunder and Regulation 22 of the Listing Regulations, the Whistle Blower Policy provides for adequate safeguards against victimisation of persons who use the Vigil Mechanism. In terms of the Policy of the Company, no

employee of the Company has been denied direct access to the Chairman of the Audit Committee of the Board.

The Whistle Blower Policy can be accessed on the website of the Company at https://storage.googleapis.com/5paisa-prod-storage/files/investor relations/2021 -05/whistle-blower-policy.pdf.

The Audit Committee is also committed to ensure fraud-free work environment. We investigate complaints speedily, confidentially and in an impartial manner and takes appropriate action to ensure that the requisite standards of professional and ethical conduct are always maintained.

Protected disclosures can be made by a whistle-blower through several channels to report actual or suspected frauds and violation of the Company’s Code of Conduct. However, during the year under review, no protected disclosure concerning any reportable matter in accordance with the Policy of the Company was received by the Company.

GOING CONCERN STATUS:

During the year under review, no significant or material orders were passed by the Regulators or Courts or Tribunals which may impact the going concern status and Company’s operations in future.

However, MCX vide its email dated March 14, 2024 ("Order") imposed a restriction on your Company with regard to onboarding of new clients across all segments with immediate effect. It was further intimated that the said restrain shall continue till the Company submits a complete Root Cause Analysis ("RCA") along with documentary evidence or for a period of 15 days, whichever is higher. Basis the action taken by MCX, NSE and BSE also imposed a similar restriction on your Company vide its email dated March 14, 2024.

Being aggrieved by the Order, the same was immediately challenged by your Company before the Hon’ble Bombay High Court by filing a writ petition. Thereafter, your Company was given an opportunity of being heard on March 27, 2024 wherein your Company had offered a detailed representation along with the Root Cause Analysis ("RCA”) and Action taken to ensure non-recurrence of the said issues in future. Despite the same, the Member and Core Settlement Guarantee Fund Committee (MCSGFC) of the MCX passed an order vide its letter dated July 01, 2024 levied a monetary penalty of '' 2,59,75,000/- (plus applicable GST) on your company and further, a non-monetary penalty of restricting on-boarding of new clients for a period of Fourteen (14) days from the date of receipt of the order.

Aggrieved by the said order, your company had filed an appeal against the said order before Hon’ble Securities Appellate Tribunal ("SAT"). SAT passed an order on July 05, 2024, granting a stay on the operation of the Impugned order of MCX subject to deposit of 50% of the penalty amount i.e. '' 1,30,00,000/- (Rupees One Crore Thirty Lakhs Only) within one

week with MCX. Your Company promptly deposited the said amount with MCX and the restriction, so imposed was revoked across Exchanges.

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

The additional information on energy conservation, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is appended as "Annexure -III" to this Directors’ Report.

PARTICULARS OF EMPLOYEES:

Disclosures with respect to the remuneration of Directors, Key Managerial Personnel and employees as required under Section 197 of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given in "Annexure-IV" to this Report. Details of employee remuneration as required under provisions of Section 197 of the Act read with Rule 5(2) & 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 also form part of this Report. However, as per the provisions of Section 136 of the Act the report and the Audited Standalone and Consolidated Financial Statements along with the Auditors’ Report thereon are being sent to the Members and others entitled thereto, excluding the said information. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary in this regard.

DISCLOSURE ON SEXUAL HARASSMENT OF WOMAN AT WORKPLACE:

Your Company recognizes its responsibility to provide equal opportunities and further it is committed to create a healthy working environment that enables all the employees to work with equality and without fear of discrimination, prejudice, gender bias or any form of harassment at workplace.

To ensure this, your Company has in place, a gender-neutral policy on prevention of sexual harassment at the workplace and a framework for employees to report sexual harassment cases at the workplace where its process ensures complete anonymity and confidentiality of information. The vigil mechanism of the Company provides for adequate safeguards against victimization of Directors, employees and third parties who avail of the mechanism and provides for direct access to the Chairman of the Audit Committee in exceptional cases.

All new employees go through a detailed personal orientation on anti-sexual harassment policy. Additionally, separate trainings (classroom/online) on Anti-Sexual Harassment Policy are conducted to educate the employees on said policy/ rules.

In compliance with the requirement of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 and rules made thereunder, your Company has constituted Internal Complaints Committee to deal with

complaints relating to sexual harassment at workplace. Details of complaint on sexual harassment are as under:

• Number of Complaints received during the year: NIL

• Number of Complaints disposed off during the year: NIL

• Number of cases pending more than 90 days: NIL

• Nature of action taken by employer or district officer: Not Applicable

The Whistle Blower Policy can be accessed on the website of the Company at https://storage.googleapis.com/5paisa-prod-storage/files/investor relations/2021 -05/whistle-blower-policy.pdf. During the year under review, no protected disclosure from any Whistle Blower was received by the Whistle Officer.

CORPORATE SOCIAL RESPONSIBILITY:

Your Company has been at the forefront in helping the Community through impactful CSR projects that have addressed critical issues of our time. CSR for a business includes being responsible for its business processes and products, and engaging in accountable relationships with its employees, customers, and the community. Your Company has built its reputation as a good corporate citizen by not only doing good business, but also by driving positive change in society. For your Company, CSR is not only about adhering to statutory and legal compliances but also creating social and environmental value for its stakeholders thus contributing to build an equal and future-ready nation.

During the year, your Company has spent '' 67,20,000/- on CSR activities. The Annual Report on CSR activities is annexed as "Annexure-V" to this report.

ENVIRONMENT, HEALTH AND SAFETY:

Your Company prioritises protecting, promoting, and enhancing employees wellbeing. Your Company recognises healthy and safe working conditions as a human right and adheres to all local and national health and safety regulations.

Given the nature of business, your Company does not undertake any manufacturing activity. However, the Company has designed and adopted manuals and procedures to cover environmental aspects and health and safety risks that the facility/property can control and directly manage and those that it does not directly control or manage but over which it can be expected to have an influence through its Environment, Health and Safety Manual.

Your Company is sensitive about the health and safety of its employees and has been achieving continuous improvement in safety performance through a combination of systems and processes as well as co-operation and support of all employees.

INDUSTRIAL RELATIONS:

The Company maintained healthy, cordial and harmonious industrial relations at all levels during the year. The Board

acknowledges the contribution of the employees and all other stakeholders towards meeting the objectives of the Company.

ANNUAL RETURN:

As per the requirements of Section 92(3) of the Act and Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return of your Company is available on your company’s corporate website at https://www.5paisa.com/ investor-relations.

CONFIRMATIONS:

1. There has been no change in the nature of business of your Company during the Financial Year 2023-24.

2. The notes on the financial statement referred in the Auditor’s Report are self-explanatory and do not call for any further comments. The Auditor’s Report does not contain any qualification, reservation, adverse remark or disclaimer for the Financial Year 2023-24.

3. There have been no instances of frauds reported by the Auditors under Section 143(12) of the Act and the Rules framed thereunder, either to the Company or to the Central Government.

4. Your Company is fully compliant with the applicable Secretarial Standards (SS) issued by Institute of Company Secretaries of India viz. SS-1 & SS-2 on Meetings of the Board of Directors and General Meetings respectively.

5. There was no instance of one-time settlement of loan obtained from the Banks or Financial Institutions.

6. No Significant or material orders passed against your Company by the Regulators or Courts or Tribunals during the year ended March 31, 2024 which would impact the going concern status of your Company and its future operations except that MCX vide its letter dated March 14, 2024, restricted the Company from onboarding new clients until the Company submitted a Root Cause Analysis (RCA) or for a period of 15 days. NSE and BSE imposed similar restrictions.

Being aggrieved by the Order, the same was immediately challenged by your Company before the Hon’ble Bombay High Court and submitted the RCA on March 27, 2024. Despite the same, MCX imposed a penalty amounting to '' 2,59,75,000/- and extended the restriction of on-boarding of new clients for 14 days from the date of receipt of the order.

Aggrieved by the said order, your Company appealed to the Hon’ble Securities Appellate Tribunal (SAT), which stayed the MCX order on July 5, 2024, subject to deposit of 50% of the penalty amount i.e. '' 1,30,00,000/-. The Company complied, and the restrictions were lifted across Exchanges.

GENERAL:

The Directors states that there being no transactions with respect to the following items during the financial year 202324, no disclosure or reporting is required with respect to the same:

1. Issue of equity shares with differential rights as to dividend, voting or otherwise.

2. Buyback of shares.

3. Receipt of any remuneration or commission by the Director(s) of your Company from any of its subsidiaries.

4. Material changes and commitments affecting the financial position of your Company that have occurred between the end of the financial year to which the financial statements relate and the date of this report, unless otherwise stated in the report.

5. Application or proceedings made under the Insolvency and Bankruptcy Code, 2016.

CAUTIONARY STATEMENT:

Statements in the Annual Report, including those which relate to Management Discussion and Analysis, describing your Company’s objectives, projections, estimates and expectations, may constitute ''forward looking statements’ within the meaning of applicable laws and regulations. Although the expectations are based on reasonable assumptions, the actual results might differ.

APPRECIATION:

Your directors place on record their sincere appreciation for the assistance and guidance provided by the Government, Regulators, Stock Exchanges, Depositories, other statutory bodies and your Company’s Bankers for the assistance, cooperation and encouragement extended to your Company.

Your 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 employees of your Company are instrumental for the Company scaling new heights, year after year. Their commitment and contribution is deeply acknowledged. Your involvement as members is also greatly valued. Your Directors look forward to your continuing support.

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Mar 31, 2023

We, the Board of Directors ("Board") are pleased to present the Sixteenth (16^th) Annual Report of 5paisa Capital Limited ("5paisa Capital", ''''our Company'''', "We") along with the Audited Financial Statements for the Financial Year ended March 31, 2023 ("year under review" or "year" or "FY 2022-23"). The consolidated performance of our Company and its subsidiaries has been referred to wherever required.

In compliance with the applicable provisions of Companies Act, 2013, (including any statutory modification(s) or re-enactment(s) thereof, for time being in force) ("Act") and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Regulations"), this report covers the financial results and other developments in respect of 5paisa Capital Limited during the financial year ended March 31, 2023 and upto the date of the Board Meeting held on May 01, 2023 to approve this report.

1. FINANCIAL RESULTS

Our Company''s Standalone and Consolidated financial performance during Financial Year 2022-23, as compared with that of the previous Financial Year 2021-22 is summarized below:

Particulars	(Rs. In Millions) CONSOLIDATED STANDALONE
	2022-23	2021-22	2022-23	2021-22
Gross total income	3,393.68	2,979.81	3,381.47	2,975.67
Profit/(Loss) before interest, depreciation and taxation	875.16	454.02	864.29	461.15
Interest and financial charges	206.34	218.69	206.34	218.69
Depreciation	87.94	50.29	80.40	42.75
Profit/(Loss) before tax	580.89	185.04	577.55	199.72
Taxation- Current	83.18	-	82.91	-
- Deferred	62.05	47.68	61.67	51.37
- Short or excess provision for income tax	-	-	-	-
Net profit/ (Loss) for the year	435.67	137.36	432.97	148.35
Less: Appropriations	-	-	-	-
Add: Balance brought forward from the previous year	(355.89)	(493.25)	(318.28)	(466.63)
Balance to be carried forward	79.77	(355.89)	114.69	(318.28)
Note: Previous periods figures have been regrouped / rearranged wherever necessary The statement containing extract of subsidiaries financial statement are provided on the corporate website at https://www.5paisa.com/investor-relations.

2. CONSOLIDATED FINANCIAL STATEMENTS:

The Consolidated Financial Statements of our Company for the FY 2022-23 are prepared in compliance with the applicable provisions of the Companies Act, 2013 (''the Act''), Indian Accounting Standards (''Ind AS'') and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 [''SEBI (LODR) Regulations''].

3. REVIEW OF BUSINESS AND OPERATIONS AND STATE OF YOUR COMPANY''S AFFAIRS

We, at 5paisa Capital, are committed to fostering the financial journeys of both prevailing and first-time investors. We provide them with a digital platform with various features that helps investors to educate themselves about the world of investments, authorize

them to take measured decisions, invest through its mobile application and elevate their participation and gains from the financial market.

Read more about our performance during the year on page no. 128 of this Report.

During the year, we focused on leveraging technology to strengthen our business processes, ensure deeper market penetration and deliver a superior customer experience. As a result, we have cemented our position as a strong player in the discount broking space, offering superior products and services.

The growing penetration of internet and smartphone in the country has helped our Company to expand

its customer base. We have leveraged an integrated investment platform to capitalize on the opportunity. Our mobile application / web platform has helped individuals to trade across equity, F&O, commodity, currency segments; invest in mutual fund and insurance; or facilitate algorithm based robo advisory services.

As capital market participation remains low in India when compared to the other developed nations, there is an enormous opportunity for growth. The outlook for financial products distribution looks healthy with gradual resumption of economic activities. Retail participation is expected to increase, given the favourable demographics, rising financial literacy and increasing smart phone and internet penetration. With the ever-increasing demand for financial transactions, the digital payments ecosystem has also been evolving continuously. These factors will enable us in fuelling 5paisa Capital''s future growth trajectory.

4. MACRO-ECONOMIC OVERVIEW

Read more about our performance during the year on page no. 128 of this Report.

5. INDUSTRY OVERVIEW

Read more about our performance during the year on page no. 128 of this Report.

6. KEY INITIATIVES / DEVELOPMENTSa. Conversion of Share Warrants:

The Capital Raising Committee of the Board of Directors of our Company in its meeting held on August 02, 2022 allotted 12,00,000 Equity Shares pursuant to exercise of options attached to the convertible warrants held by Mr. Nirmal Jain, Mrs. Madhu Jain & Mr. Venkataraman Rajamani, Promoters of the Company, consequent to the receipt of notice for exercise, along with the balance 75% of the application money (being '' 375/- per share) due on the said warrants, i.e. '' 45,00,00,000 (INR Forty Five Crore only). The trading approval for the 12,00,000 equity shares was received by our Company from BSE and NSE on August 25, 2022. However, the allotted shares are locked-in up to August 29, 2025 as required by SEBI (ICDR) Regulations, 2018.

b. Scheme of Arrangement between IIFL Securities Limited and 5paisa Capital Limited and their respective shareholders and creditors:

The Board of Directors at their meeting held on December 06, 2022, approved the Scheme of Arrangement between IIFL Securities Limited

and 5paisa Capital Limited and their respective shareholders and creditors under Section 230-232 of the Companies Act, 2013, as amended read with other applicable provisions of the Act and Rules made thereunder, which envisages the transfer of the Online Retail Trading Business (Demerged Undertaking) from the IIFL Securities Limited to our Company, so as to consolidate the said business under our Company subject to the approval of the shareholders and such other class of persons as directed by the Hon''ble National Company Law Tribunal, Mumbai Bench (Hon''ble NCLT), sanction of the Hon''ble NCLT and such other approvals as may be required.

Our Company has filed an application with BSE Limited, National Stock Exchange of India Limited and such other membership departments wherein your Company holds membership for obtaining No Objection Certificate pursuant to Regulation 37 of SEBI (Listing Obligation and Disclosure Requirement) Regulation, 2015 and the same is under process. We shall file an application to the Hon''ble National Company Law Tribunal (NCLT), Mumbai Bench for the sanction of scheme post receipt of No Objection Certificate from the aforesaid exchanges and other authorities.

Upon the Scheme becoming effective, our Company shall issue 1 (one) fully paid up equity share of INR 10 (Indian Rupees Ten only) each for every 50 (fifty) equity shares of INR 2 (Indian Rupees Two only) each of IIFL Securities Limited.

The details of the Scheme and other related documents are available on our company''s corporate website at https://www.5paisa.com/ investor-relations.

c. Setting up of 5paisa International Securities (IFSC) Limited:

With a view to offer diversified products to its customers, our Company intends to offer an option to its clients for trading in US stocks by registering itself with NSE IFSC Ltd. as a trading cum clearing member. Consequently, our Company has incorporated a wholly owned IFSC subsidiary viz. 5paisa International Securities (IFSC) Limited and is in process of seeking all the regulatory licenses and permissions to commence its operations shortly.

7. RETURN TO INVESTORS (DIVIDEND):

In order to conserve the resources of our Company for future expansion, the Directors have decided not to recommend any dividend on equity shares of our Company for the financial year under review.

The Dividend Distribution Policy is available on the website at https://storage.googleapis.com/5paisa-prod-storage/files/investor relations/2022-04/Dividend%20 Distribution%20Policy 1.pdf

8. TRANSFER TO GENERAL RESERVE:

During the year under review, our Company has not transferred any amount to the reserves.

9. TRANSFER OF FUNDS TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF):

Pursuant to the provisions of Section 124 and 125 of the Companies Act, 2013 ("Act") read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("IEPF Rules"), all unpaid or unclaimed dividends are required to be transferred by our Company to the Investor Education and Protection Fund ("IEPF" or "Fund") Account established by the Central Government, after completion of seven years from the date the dividend is transferred to unpaid/ unclaimed account. Further, according to the Rules, the shares in respect of which dividend has not been paid or claimed by the members for seven consecutive years or more shall also be transferred to the demat account created by the IEPF Authority after complying with the procedure laid down under the Rules.

During FY 2022-23, our company had not transferred any shares to ''IEPF'' Account.

However, as on the March 31, 2023, '' 0.18 million is lying as the unclaimed fractional entitlements in the unpaid fractional shares account.

10. AWARDS AND RECOGNITION:

During the year under review, our Company received numerous awards and accolades which were conferred by reputable organizations and is designed to honor the efforts made by us and the details of the same are given herein below:

• The Great Indian BFSI CEO of the Year

Mr. Prakarsh Gagdani, Chief Executive Officer and Whole-Time Director of our Company has been recognized as The Great Indian BFSI CEO of the Year.

• The Great Indian BFSI fastest growing Company of the Year

5paisa Capital Limited was recognized as

"The Great Indian BFSI fastest growing Company of the Year".

• Naya Bharat Business Conclave 2022

5paisa Capital Limited was awarded in Naya Bharat Business Conclave 2022.

• Excellence in Online Share Trading

5paisa Capital Limited was recognized as

"Excellence in Online Share Trading".

• Digixx Awards 2022

5paisa Capital Limited won Silver in Digixx Awards 2022.

• Best Integration of Digital Content with TV

5paisa Capital Limited was recognized as "Best Integration of Digital Content with TV".

11. SHARE CAPITAL:

The paid up equity share capital of our Company as on March 31, 2023 was '' 306,355,680/- divided into 30,635,568 equity shares of '' 10/- each as compared to '' 294,173,180/- divided into 29,417,318 equity shares of '' 10/- each as on March 31, 2022.

The increase in the share capital was on account of issuance of 12,00,000 equity shares on preferential basis to promoters pursuant to conversion of Share Warrants as mentioned above in Point No. 6 of this Report and pursuant to exercise of 18,250 ESOPs granted under the 5paisa Capital Limited Employee Stock Option Scheme 2017, by eligible employees, which were converted into equity shares '' 10/- each.

12. EMPLOYEES STOCK OPTION SCHEMES ("ESOS"):

Presently, our Company has two Schemes which are prepared as per the provisions of SEBI (Share Based Employee Benefits) Regulations, 2014 ("SBEB Regulations"):

1) 5paisa Capital Limited Employee Stock Option Scheme 2017 ("5PCL ESOS 2017") was approved by shareholders vide a special resolution dated January 25, 2018.

2) 5paisa Capital Limited Employee Stock Option Trust Scheme 2017 ("5PCL ESOTS 2017") was approved by shareholders vide a special resolution dated January 25, 2018.

During the year under review, there was no material change in ESOS of our Company. As per Regulation 14 of "SBEB Regulations”, read with SEBI circular no. CIR/CFD/ POLICY CELL/2/2015 dated June 16, 2015, the details of the "ESOS” are uploaded on our corporate website at https://www.5paisa.com/investor-relations and the same is available for inspection by the Members at the Registered Office of our Company. If any member is interested in obtaining a copy thereof, such member may write to the Company Secretary, whereupon a soft copy would be sent at the registered email address of the Member. A certificate from Secretarial Auditor of the Company confirming that the Scheme has been implemented in accordance with the applicable Regulations would be made available for inspection by Members through electronic means.

13. INCREASE IN SIZE OF ESOP POOL:

The Board of Directors in their meeting held on January 11, 2023 and pursuant to recommendation of Nomination and Remuneration Committee, approved the increase in size of ESOP Pool for grant of options to eligible employees under the Employee Stock Option Scheme-2017 from 15,00,000 (Fifteen Lakhs) options to 22,00,000 (Twenty-two Lakhs) options convertible into equity shares of '' 10/- each of the Company. Further, the members vide Special Resolution dated March 01, 2023 passed through postal ballot also approved the same.

14. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

Particulars of loans, guarantees given and investments made during the year, as required pursuant to the provisions of Section 186 of the Companies Act, 2013 and schedule V of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("LODR Regulations”), forms part of the financial statements.

15. DEPOSITS:

Our Company has not accepted any deposits from public falling under the ambit of Section 73 of the Companies Act, 2013 and the Rules framed thereunder and as such, no amount on account of principal or interest on deposits from public was outstanding as on the Balance Sheet date.

Further, our Company does not intend to raise any public deposits, in terms of its declaration to the Reserve Bank of India.

16. SUBSIDIARIES:

• 5paisa P2P Limited

During the year under review, the company continued its operations as P2P NBFC. However, the lending and borrowing activities on the said platform were carried out conservatively.

• 5paisa Corporate Services Limited (Formerly known as 5paisa Insurance Brokers Limited)

Since, no business was undertaken in the company from the date of incorporation and on account of its inability to register as an Insurance Broker, the management decided to change the main object of the Company and undertake different business under the said company. Accordingly, the name of the company was changed from ''5paisa Insurance Brokers Limited'' to ''5paisa Corporate Services Limited'' with effect from November 16, 2022 pursuant to receipt of fresh Certificate of Incorporation dated November 16, 2022 issued by the Registrar of Companies, Mumbai, in order to align with the main object of the company. The Company shall commence its business shortly.

• 5paisa Trading Limited

During the year under review, the Company commenced its business by offering an online trading platform to its clients to trade in Digital Gold.

• 5paisa International Securities (IFSC) Limited

5paisa International Securities (IFSC) Limited was incorporated as a public limited company on June 15, 2022 as a wholly owned subsidiary of 5paisa Capital Limited. 5paisa International Securities (IFSC) Limited is incorporated with the intention of carrying out business of IFSC (International Financial Service Centre) Unit and act as intermediary in IFSC. The Company is in process of registration with NSE IFSC Limited as a trading cum clearing member and shall commence its operations after receipt of necessary clearances / licenses.

17. CONSOLIDATED FINANCIAL STATEMENTS:

As per the provisions of section 134 and 136 of the Companies Act, 2013 read with applicable Rules, Regulation 33 of LODR Regulations and applicable Accounting Standards, the Board of Directors had in their meeting held on May 01, 2023 approved the Consolidated Financial Statements of our Company along with the Standalone Financial Statements. Copies of the Balance Sheet, Statement of Profit & Loss, Report of the Board of Directors and Report

of the Auditors of the subsidiary company are not attached to the accounts of our Company for the financial year 2022-23. Our Company will arrange for soft copies of these documents/ details upon request by any member of the Company and dispatch the same on the registered email address of the member.

These documents/details will also be available for inspection by any member of our Company at its registered office and at the registered offices of the concerned subsidiary during the business hours on working days i.e. except on Saturdays, Sundays and Public Holidays. If any member is interested in obtaining a copy thereof, such member may write to the Company Secretary, whereupon a soft copy of the same would be sent to the registered email address of the member. The Annual Report of subsidiaries is uploaded on our corporate website at https:// www.5paisa.com/investor-relations. As required by Companies Act, 2013 and Accounting Standard - 21 (AS 21) issued by the Institute of Chartered Accountants of India, our Company''s Consolidated Financial Statements included in this Annual Report incorporate the accounts of its subsidiaries. A report on the performance and financial position of the subsidiaries is provided in the prescribed form AOC-1 as "Annexure-I" to this Directors'' Report.

The policy on determining the material subsidiary is available on our corporate website at https://storage. googleapis.com/5paisa-prod-storage/files/investor_ relations/2021-05/policy-on-determining-material-subsidiary.pdf.

18. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

In accordance with Regulation 34 of LODR Regulations, the Management Discussion and Analysis Report is presented in separate section to this Annual Report.

19. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT:

Pursuant to Regulation 34(2) of the Listing Regulations read with SEBI Circular No. CIR/CFD/CMD/10/2015 and PR No. 18/2021 dated November 04, 2015 and May 10, 2021 respectively, the Business Responsibility and Sustainability Report describing the initiatives taken by our Company, from an environmental, social and governance perspective is provided in a separate section and forms part of this Annual Report.

20. DIRECTORS AND KEY MANAGERIAL PERSONNEL:

a. Directors: The Board comprises of the following Directors as on March 31, 2023.
Mr. Prakarsh Gagdani (DIN: 07376258)	Whole-Time Director
Mr. Gourav Munjal (DIN: 06360031)	Whole-Time Director
Dr. Archana Hingorani (DIN: 00028037)	Non - Executive Independent Director
Mr. Milin Mehta (DIN: 01297508)	Non - Executive Independent Director
Mr. Ravindra Garikipati (DIN: 00984163)	Non - Executive Independent Director
Ms. Nirali Sanghi (DIN: 00319389)	Non - Executive Independent Director

I. Changes in Board Composition

During the year under review, there were no changes in the composition of the Board.

II. Retirement by Rotation

In accordance with Section 152 of the Companies Act, 2013 ("Act") read with Article 157 of the Articles of Association of the Company, Mr. Gourav Munjal (DIN: 06360031), Whole Time Director and Chief Financial Officer of our Company is liable to retire by rotation at the ensuing Annual General Meeting and being eligible, has offered himself for re-appointment. The Board recommends their re-appointment for the approval of members. A resolution seeking approval of the members for his re-appointment forms part of the Notice of 16^th AGM of our Company.

There was no change in the composition of the Board of Directors and Key Managerial Personnel during the financial year ended March 31, 2023, except as stated above.

b. Key Managerial Personnel:

Pursuant to the provisions of Section 203 of the Companies Act, 2013 and rules made thereunder,

the Key Managerial Personnel of our Company as on March 31, 2023 are:

Mr. Prakarsh Gagdani : Whole-Time Director & Chief Executive Officer

Mr. Gourav Munjal : Whole-Time Director & Chief Financial Officer

Mrs. Namita Godbole : Company Secretary & Compliance Officer

The Remuneration and other details of the Key Managerial Personnel for the year ended March 31, 2023 are mentioned in Form MGT-7 - Annual Return which can be accessed on our corporate website at https://www.5paisa.com/investor-relations.

Further, pursuant to SEBI Circular No. SEBI/ HO/MIRSD/MIRSD-PoD-1/P/CIR/2023/24 dated February 06, 2023, your company has recognized and has designated following CXO level officers as a Key Managerial Personnel of your company for managing the key risks.

Mrs. Namita Godbole : Chief Compliance Officer

Mr. Yogesh Maroli : Chief Information Security Office

21. MEETING OF DIRECTORS AND COMMITTEE/BOARD EFFECTIVENESS:

• Meetings of the Board of Directors

The Board met Five (5) times during the year to discuss and approve various matters including financials, raising of funds, review of audit reports and other businesses. For further details please refer to the report on Corporate Governance.

• Committees of the Board of Directors (as on March 31, 2023)

In accordance with the applicable provisions of the Companies Act, 2013 and LODR Regulations, the Board has in place the following Committees:

¦ Audit Committee

¦ Nomination and Remuneration Committee

¦ Stakeholders Relationship Committee

¦ Finance Committee

¦ Risk Management Committee

¦ Corporate Social Responsibility Committee

¦ Environment, Social and Governance (ESG) Committee

¦ Independent Directors (ID) Committee

• Audit Committee:

During the year, there was no change in the composition of Audit Committee. The Audit Committee met Five (5) times which is in compliance with the provisions of LODR Regulations and Companies Act, 2013. The Committee comprises of Mr. Milin Mehta as the Chairman, Ms. Nirali Sanghi and Dr. Archana Hingorani as the Members of the Audit Committee.

The role, terms of reference and powers of the Audit Committee are in conformity with the requirements of the Companies Act, 2013 and LODR Regulations. The Committee met during the year under review and discussed on various matters including financials and audit reports. During the period under review, the Board of Directors of our Company accepted all the recommendations of the Audit Committee.

The terms of reference of Audit Committee and details of Committee Meeting are provided in the Corporate Governance Report.

• Nomination & Remuneration Committee

During the year, the Nomination & Remuneration Committee met Two (2) times. The Committee comprises of Ms. Nirali Sanghi as the Chairperson, Dr. Archana Hingorani, Mr. Ravindra Garikipati and Mr. Milin Mehta as members of the Committee.

The role, terms of reference and powers of the Nomination & Remuneration Committee are in conformity with the requirements of the Companies Act, 2013 and LODR Regulations and the same has been provided in the Corporate Governance Report.

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a Nomination and Remuneration Policy in compliance with the aforesaid provisions for selection and appointment of Directors, Key Managerial Personnel (KMP), Senior Managerial Personnel (SMP) of our company. The said policy is stated in the Corporate Governance Report of our Company and can also be accessed on our corporate website at https://www.5paisa.com/investor-relations.

The details of Committee Meeting are provided in the Corporate Governance Report.

• Stakeholders Relationship Committee

During the year, the Stakeholders Relationship Committee met one (1) time in compliance with the provisions of LODR Regulations and Companies Act, 2013. The Committee comprises of Ms. Nirali Sanghi as the Chairperson, Dr. Archana Hingorani and Mr. Prakarsh Gagdani as the Members of the Committee.

The role, terms of reference of the Stakeholders Relationship Committee are in conformity with the requirements of the Companies Act, 2013 and Regulation 20 of LODR Regulations and the same has been provided in the Corporate Governance Report.

During the year under review, our Company has not received any complaints from any Stakeholders. The details of the Meeting are given in the Corporate Governance Report.

• Finance Committee

During the year, the Finance Committee met Eighteen (18) times. The Committee comprises of Mr. Prakarsh Gagdani as the Chairman and Mr. Gourav Munjal as the member of the Committee.

The role and terms of reference of the Finance Committee are in conformity with the requirements of the Companies Act, 2013 and Regulation 20 of LODR Regulations and the same has been provided in the Corporate Governance Report.

The details of the Meetings are given in the Corporate Governance Report.

• Risk Management Committee

During the year, the Risk Management Committee met Two (2) times. The Committee comprises of Dr. Archana Hingorani as Chairperson, Mr. Prakarsh Gagdani and Mr. Gourav Munjal as the member of the Committee.

Our Company is exposed to a lot of inherent uncertainties owing to the sector in which it operates. A key factor in ascertaining a company''s capacity to maintain its sustainable value is the risks that it is willing to take at both - strategic and operational level and its ability to manage them effectively.

Our Company''s Risk Management processes focus on ensuring that the risks to which our company is exposed to, at all times, are identified on a timely basis and addressed with appropriate solutions. Further, as mandated by LODR Regulations, the Board of Directors, in its meeting held on April 20, 2021, has constituted a Risk Management Committee.

The Committee has adopted a Risk Management policy which outlines the role, responsibilities and powers of the Committee and the procedure and periodicity for organizing the meeting of the Committee. The purpose of the Committee is to assist the Board of Directors in fulfilling its oversight responsibilities with regard to enterprise risk management. The Committee shall review the risk management practices and actions deployed by the Management with respect to identification, impact assessment, monitoring, mitigation and reporting of key risks while at the same time trying to achieve its business objectives. Further, the Committee shall endeavor to assist the Board in framing, implementing and monitoring the risk management plan for our Company and reviewing and guiding the risk policy.

The Committee shall have the primary responsibility of implementing the Risk Management Policy of our Company and achieving the stated objective of developing a risk mitigated culture that supports decision making and helps improve our Company''s performance.

The role, terms of reference of the Risk Management Committee are in conformity with the requirements of the Companies Act, 2013 and LODR Regulations and the same has been provided in the Corporate Governance Report.

The Directors, on a regular basis:

(a) oversee and approve our Company''s enterprise-wide risk management framework

(b) oversee that all the risks that the organization faces such as strategic, financial, credit, market, liquidity, security, property, IT, legal, regulatory, reputational KYC Risk, technology risks, operational risk, general risk which includes fraud risk, risk due to outsourcing of activities to third parties and other risks have been identified and assessed and there is an adequate risk management infrastructure in place capable of addressing those risks.

Our company has in place various policies and procedures covering the business, operations, employees, finance & accounting, customer services which are approved by the Board.

Our Company has in place specialized internal audits on Broking and Depository Participant business as per the SEBI / Exchanges / Depositories norms. The findings on Audit Reports are reviewed by the Audit Committee / Board at their periodical meetings and the reports are submitted to the Exchanges / Depositories.

Our management monitors and reports on the principal risks and uncertainties that can impact our Company''s ability to achieve its strategic objectives.

Our management systems, organizational structures, processes, standards and code of conduct together form the risk management governance system of our Company and management of associated risks.

• Corporate Social Responsibility Committee

During the year, the Corporate Social Responsibility Committee met One (1) time. The Committee comprises of Mr. Milin Mehta as Chairman, Mr. Prakash Gagdani and Mr. Gourav Munjal as Members of the Committee.

The Board of Directors, in their meeting held on April 20, 2021 has framed and adopted the Corporate Social Responsibility (CSR) policy, which can be accessed on our corporate website, at https://storage.googleapis.com/5paisa-prod-storage/files/investor relations/2022-04/ CSR-Policy-updated.pdf.

Annual Report on CSR activities, as required under sections 134 and 135 of the Companies Act, 2013 read with rule 8 of the (Corporate Social Responsibility Policy) Rules, 2014, as amended ("CSR Rules”) is provided as "Annexure V” to this Directors Report.

Further, our Company is required to spend at least 2% of its average net profits during three immediately preceding financial years, in pursuance of its Corporate Social Responsibility Policy.

• Environmental, Social and Governance ("ESG") Committee

The Environmental, Social and Governance ("ESG”) Committee was constituted on December 01, 2022 and the Members of the Committee comprises of Ms. Nirali Sanghi, Independent Director, as the Chairperson, Mr. Gourav Munjal, Whole-Time Director and Chief Financial Officer and Ms. Namita Godbole, Company Secretary and Compliance officer as the Members.

The role and terms of reference of the ESG Committee has been provided in the Corporate Governance Report.

• Independent Directors (ID) Committee

The Independent Directors (ID) Committee was constituted on December 01, 2022 and the Members of the Committee comprises of Mr. Ravindra Garikipati, Independent Director, as the Chairman, Ms. Nirali Sanghi, Independent Director, Dr. Archana Hingorani, Independent Director and Mr. Milin Mehta, Independent Director as the Members.

The role and terms of reference of the ID Committee has been provided in the Corporate Governance Report.

The details of the Meeting are given in the Corporate Governance Report.

• Board Effectiveness

• Familiarization Program for the Independent Directors:

In compliance with the requirements of LODR Regulations, our Company has put in place a Familiarization Program for Independent Directors to familiarize them with the working of our Company, their roles, rights and responsibilities vis-a-vis our Company, the industry in which the Company operates business model etc. Details of the Familiarization Program are explained in the Corporate Governance Report and are also available on our corporate website at https:// storage.googleapis.com/5paisa-prod-storage/files/investor relations/2021-04/ familarisation-programmes.pdf

• Board Evaluation:

Pursuant to the provisions of the Companies Act, 2013 and LODR Regulations and SEBI Circular No. SEBI/CFD/CMD/CIR/P/2017/004 dated January 05, 2017, the Board of Directors have carried out an annual performance evaluation of its own performance, its Committees, the Directors individually including Independent Directors (wherein the concerned Director being evaluated did not participate) based out of the criteria and framework adopted by the Board. The Board approved the evaluation results as collated by Nomination & Remuneration Committee ("NRC"). The evaluation process, manner and performance criteria for independent directors in which the evaluation has been carried out is explained in the Corporate Governance Report which forms part of this Annual Report. The Board is responsible to monitor and review the evaluation framework.

The Board considered and discussed the inputs received from the Directors. Also, the Independent Directors at their meeting held on March 21, 2023 reviewed the following:

• Performance of Non-Independent Directors and the Board and the Committee as a whole.

• Performance of the Chairperson of your Company.

• Assessed the quality, quantity and timeliness of flow of information between our Company''s management and the Board, which is necessary for the Board to effectively and reasonably perform their duties.

The Independent Directors expressed their satisfaction with overall functioning and implementations of their suggestions.

The evaluation process endorsed the Board Members confidence in the ethical standards of our Company, the cohesiveness that exists amongst the Board Members, the two-way candid communication between the Board and the Management and the openness of the Management in sharing strategic information to enable Board Members to discharge their responsibilities.

• Statement on declaration given by the Independent Directors :

The terms and conditions of appointment of Independent Directors are as per Schedule IV of the Act. Our Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of independence as prescribed under sub-section (6) of Section 149 of the Companies Act, 2013 and rule 5 of the Companies (Appointment and Qualifications of Directors) Rules, 2014 and as well as under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations") and there has been no change in the circumstances or situation, which exist or may be reasonably anticipated, that could impair or impact the ability of Independent Directors to discharge their duties with an objective independent judgment and without any external influence.

The above declarations were placed before the Board and in the opinion of the Board, all the Independent Directors fulfil the conditions specified under the Act and the SEBI Listing Regulations and are Independent to the Management.

22. DIRECTORS'' RESPONSIBILITY STATEMENT:

Pursuant to the requirement under Sections 134(3)(c) and 134(5) of the Companies Act, 2013, the Board of Directors, to the best of its knowledge and ability, confirm that:

a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures.

b) t hey 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 our Company at the end of the financial year and of the profit or loss of our Company for that period.

c) they have taken proper and sufficient care 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.

d) they have prepared the annual accounts on a going concern basis.

e) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively.

f) They have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

23. INTERNAL CONTROL SYSTEMS:

Internal audit and its adequacy

The scope and authority of the internal audit function is well defined and to maintain independence and objectivity in its functions, the internal audit function reports directly to the Audit Committee of the Board. At the beginning of each Financial Year, a risk-based annual audit plan is rolled out after it is approved by the Audit Committee of the Board. The audit plan aims to evaluate the efficacy and adequacy of the internal control system(s) and compliance(s) thereof, robustness of internal processes, policies and accounting procedures, compliance with laws and regulations. The Internal Audit function, consisting of professionally qualified chartered accountants and specialists, is adequately skilled and resourced to deliver audit assurances at highest levels. Based on the reports of internal audit function, process owners undertake corrective action in their respective areas. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board.

Internal Financial Controls Systems and their Adequacy

Our Company has in place adequate internal controls with reference to financial statements and operations and the same are operating effectively. The Internal Auditors tested the design and effectiveness of the key controls and no material weaknesses were observed in their examination. Further, Statutory Auditors verified the systems and processes and confirmed that the Internal Financial Controls system over financial reporting are adequate and such controls are operating effectively.

Based on the framework of internal financial controls and compliance systems established and maintained by our Company, the work performed by the internal, statutory and secretarial auditors and external consultants, including the audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by management and the relevant

board committees, including the Audit committee, the Board is of the opinion that our Company''s internal financial controls were adequate and effective during FY 2022-23.

24. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES:

Our Company has put in place a policy for Related Party Transactions (RPT Policy), which has been approved by the Board of Directors. The policy provides for identification of RPTs, necessary approvals by the Audit Committee / Board / Members, reporting and disclosure requirements in compliance with Companies Act, 2013 and provisions of LODR Regulations.

All transactions with Related Parties are placed before the Audit Committee and also the Board for approval. Prior omnibus approval of the Audit Committee and the Board is obtained for the transactions which are foreseeable and of a repetitive nature. The transactions entered into pursuant to the approvals so granted are subjected to audit and a statement giving details of all related party transactions is placed before the Audit Committee and the Board of Directors on a quarterly basis. The statement is supported by a certificate from Independent Chartered Accountant.

All contracts executed by our Company during the financial year with related parties were on arm''s length basis and in the ordinary course of business. All such Related Party Transactions were placed before the Audit Committee / Board for approval, wherever applicable.

During the year, our Company has entered into any contract / arrangement / transaction with related parties, which are considered as material in accordance with Regulation 23 of LODR Regulations and the same was also approved by the members in the Annual General Meeting held on July 11,2022. The policy for determining ''material'' subsidiaries and the policy on materiality of Related Party Transactions and dealing with Related Party Transactions as approved by the Board may be accessed on our corporate website at https://www.5paisa.com/investor-relations. You may refer to Note no. 33 to the financial statement, which contains related party disclosures.

Our Company had not entered into any contracts or arrangements or transactions under sub-section (1) of section 188 of the Act. Hence, Form AOC-2 disclosure is not required to be provided.

None of the Directors and the Key Managerial Personnel has any pecuniary relationships or transactions vis-a-vis the Company.

25. ANNUAL RETURN:

As per the requirements of Section 92(3) of the Act and Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return of our Company is available on the corporate website at https://www.5paisa.com/investor-relations.

26. CHIEF EXECUTIVE OFFICER (CEO) AND CHIEF FINANCIAL OFFICER (CFO) CERTIFICATION:

A Certificate from Mr. Prakarsh Gagdani, CEO and Mr. Gourav Munjal, CFO, pursuant to provisions of SEBI (LODR) Regulations, 2015, for the year under review was placed before the Board of Directors of our Company at its meeting held on May 01, 2023.

27. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF OUR COMPANY:

There have been no material changes and commitments affecting the financial position of our Company, which have occurred between the end of the financial year of our Company to which the financial statements relate and the date of this Annual Report. There has been no change in the nature of business of our Company as on the date of this Report.

However, kindly note that Exchange vide its circulars no. NSE/INSP/4519 dated July 31, 2020 and NSE/ INSP/49929 dated October 12, 2021, had directed all the stock brokers for reversing the penalties levied on account of short / non-collection of upfront margins to its clients, if the same were debited to the clients in the past. Consequently, in adherence to the directions, the company had reversed an amount of '' 709 Lakhs to its eligible clients during the year, being the amount recovered from such clients on account of penalty levied by clearing corporation on company for "Short Collection / Non-collection of upfront margins from the client" since October 11, 2021 as per NSE Circular Ref. No. NSE/ INSP/53525 dated September 02, 2022. The same has been included in "Other Expenses" of above "Statement of Standalone Financial Results" in Q3 FY 2022-23 and in FY 2022-23.

28. SECRETARIAL AUDITOR, SECRETARIAL AUDIT REPORT AND COMPLIANCE WITH SECRETARIAL STANDARDS:

In terms of the provisions of Section 204 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board has

appointed M/s. Nilesh Shah & Associates, Company Secretaries in whole-time practice, Mumbai, as Secretarial Auditor for conducting Secretarial Audit of our Company for the financial year 2022-23. The Auditor had conducted the audit and their report thereon was placed before the Board. The Secretarial Audit Report for the Financial Year 2022-23 does not contain any material observations or instances of non-compliance in respect of the same. The Secretarial Auditor''s report is appended as "Annexure - II" to this Directors'' Report. Our Company is in compliance with the Secretarial Standards, specified by the Institute of Company Secretaries of India ("ICSI").

29. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

The additional information on energy conservation, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is appended as "Annexure -III" to this Directors'' Report.

30. WHISTLE BLOWER POLICY/ VIGIL MECHANISM:

Our Company since its inception believes in honest and ethical conduct from all the employees and others who are directly or indirectly associated with us.

Further, in compliance of the Companies Act, 2013 and Regulation 22 of LODR Regulations, we have adopted a Whistle Blower Policy. Our Company''s vigil mechanism/ Whistle blower Policy aims to provide the appropriate platform for Whistle blowers to report instances of any actual or suspected incidents of unethical practices, violation of applicable laws and regulations including our Company''s code of conduct or ethics policy or Code of Conduct for Prevention of Insider Trading in our Company, Code of Fair Practices and Disclosure. The Policy also provides for adequate safeguards against victimization of Director(s)/ Employee(s) who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee in exceptional cases. It is affirmed that no person has been denied access to the Audit Committee. Our Company has disclosed the policy at our corporate website at https://storage.googleapis.com/5paisa-prod-storage/files/investor relations/2021-05/whistle-blower-policy.pdf.

The Audit Committee is also committed to ensure fraud-free work environment. We investigate complaints speedily, confidentially and in an impartial manner and takes appropriate action to ensure that the requisite standards of professional and ethical conduct are always maintained.

During the financial year 2022-23, no cases under this mechanism were reported to our Company and/or to any of its subsidiaries.

31. PREVENTION OF SEXUAL HARASSMENT:

We recognize our responsibility and provide equal opportunities and are committed to creating a healthy working environment that enables all our employees to work with equality and without fear of discrimination, prejudice, gender bias or any form of harassment at workplace. In compliance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, our Company has put in place a Policy on prevention of Sexual Harassment of Women at workplace. We have complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The policy is frequently communicated at regular intervals through various assimilation programs to all the employees.

The Directors further state that during the fiscal year 2022-23, there were no complaints pending pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The following is reported pursuant to Section 22 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013:

a) Number of complaints received in the year: Nil

b) Number of complaints disposed off during the year: Nil

c) Number of cases pending more than ninety days: Nil

d) Number of workshops or awareness program against sexual harassment carried out: Our Company has conducted an online training for creating awareness against the sexual harassment against the women at workplace.

e) Nature of action taken by the employer or district officer: Not Applicable.

Further, awareness and training sessions about the Prevention of Sexual Harassment at workplace are conducted for all employees, including our associates. Further, following are some of the awareness programs imparted to train the employees and Internal Complaints Committee ("ICC”) during the year:

1. Every employee of our company has to undergo mandatory e-learning module on "Prevention of Sexual Harassment” at workplace.

2. Every new joiner is trained on Prevention of Sexual Harassment during induction program.

3. The Internal Complaints Committee is appropriately trained when the Committee Members are on-boarded to the Committee.

4. Policy of "Prevention of Sexual Harassment” at workplace is available on the intranet portal to access as and when required. Further, our company has setup an ICC which has equal representation of men and women and is chaired by senior woman and has an external women representation. The details of ICC members have been prominently displayed across all areas in office.

32. PARTICULARS OF EMPLOYEES:

The statement of Disclosure pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in "Annexure - IV” to this Directors'' Report.

Further, a statement showing the names and other particulars of employees drawing remuneration in excess of the limits as set out in the Rules 5(2) and 5(3) of the aforesaid Rules, forms part of this Annual Report. However, in terms of first proviso to Section 136(1) of the Act, the Annual Report and Accounts are being sent to the Members and others entitled thereto, excluding the aforesaid information. The said information is available for inspection by any member of our Company during the business hours on working days except on Saturdays, Sundays and Public Holidays upto the date of the ensuing Annual General Meeting ("AGM”). Any Member interested in obtaining a copy of the same may write to the Company Secretary at [email protected]. whereupon a soft copy would be sent to the Member.

33. STATUTORY AUDITORS:

As per Section 139 of the Companies Act, 2013, read with Companies (Audit and Auditors) Rules, 2014, the members of our Company in its 15^th AGM of the Company approved the re-appointment of M/s. V Sankar Aiyar & Co., Chartered Accountants, Mumbai (Firm Registration Number: 109208W), as the Statutory Auditors of our Company for a term of five consecutive years i.e. from the conclusion of 15^th AGM till the conclusion of 20^th AGM of our Company.

34. AUDITORS'' REPORT:

The notes on the financial statement referred in the Auditor''s Report are self-explanatory and do not call for

any further comments. The Auditor''s Report does not contain any qualification, reservation, adverse remark or disclaimer for the Financial Year 2022-23.

5. REPORTING OF FRAUDS BY AUDITORS:

During the year under review, the Statutory Auditors and the Secretarial Auditor have not reported any instances of frauds committed in our Company by its Officers or Employees to the Audit Committee under section 143(12) of the Companies Act, 2013, details of which needs to be mentioned in this Report.

6. CORPORATE GOVERNANCE:

Our Company has a strong legacy of following fair, transparent and ethical governance practices and is committed to maintain the highest standards of Corporate Governance and strictly adheres to the Corporate Governance requirements set out by SEBI. Our Company''s Corporate Governance policy is based on the belief that good governance is an essential element of business, which helps us fulfill our responsibilities towards all our stakeholders. The report on Corporate Governance as stipulated under the LODR Regulations forms an integral part of this Annual Report of our Company. The requisite Auditor''s Certificate on Corporate Governance obtained from M/s. V Sankar Aiyar & Co., Chartered Accountants (Firm Registration Number: 109208W) for compliance with LODR Regulations is attached to the report on Corporate Governance.

7. MAINTENANCE OF COST RECORDS:

The maintenance of cost records, for the services rendered by our Company is not required pursuant to Section 148(1) of the Companies Act, 2013 read with Rule 3 of the Companies (Cost records and audit) Rules, 2014.

8. GENERAL:

The Directors states that there being no transactions with respect to the following items during the financial year 2022-23, no disclosure or reporting is required with respect to the same:

1. I ssue of equity shares with differential rights as to dividend, voting or otherwise.

2. Significant or material orders passed against our Company by the Regulators or Courts or Tribunals during the year ended March 31, 2023 which would impact the going concern status of our Company and its future operations.

3. Buyback of shares.

4. Receipt of any remuneration or commission by the Whole-time Director of our Company from any of its subsidiaries.

5. Material changes and commitments affecting the financial position of our Company that have occurred between the end of the financial year to which the financial statements relate and the date of this report, unless otherwise stated in the report.

6. Application or proceedings made under the Insolvency and Bankruptcy Code, 2016.

39. APPRECIATION:

The Directors place on record their sincere appreciation for the assistance and guidance provided by the Government, Regulators, Stock Exchanges, Depositories, other statutory bodies and our Company''s Bankers for the assistance, cooperation and encouragement extended to our Company.

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. Our employees are instrumental for the Company scaling new heights, year after year. Their commitment and contribution is deeply acknowledged. Your involvement as members is also greatly valued. The Directors look forward to your continuing support.

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Mar 31, 2018

Dear Shareholders,

The Directors present the Eleventh Annual Report of 5paisa Capital Limited (‘your Company’) together with the Audited Financial Statements for the financial year ended March 31, 2018.

1. FINANCIAL RESULTS

A summary of the consolidated and Standalone financial performance of your Company, for the financial year ended March 31, 2018, is as under:

(Rs. in Millions)

Particulars	Consolidated Financial Results		Standalone Financial Results
	2017-18	2016-17	2017-18	2016-17
Gross total income	196.52	74.67	196.52	74.67
Profit/(Loss) before interest, depreciation and taxation	(317.48)	(148.52)	(317.48)	(148.52)
Interest and financial charges	7.95	12.51	7.95	12.51
Depreciation	6.67	2.77	6.67	2.77
Profit/(Loss) before tax	(332.10)	(163.81)	(332.10)	(163.81)
Taxation - Current	Nil	Nil	Nil	Nil
- Deferred	(79.12)	(46.55)	(79.12)	(46.55)
- Short or excess provision for income tax	Nil	(0.35)	Nil	(0.35)
Net profit/ (Loss) for the year	(252.99)	(116.90)	(252.99)	(116.90)
Less: Appropriations	Nil	Nil	Nil	Nil
Add: Balance brought forward from the previous year	(116.08)	0.82	(116.08)	0.82
Balance to be carried forward	(369.07)	(116.08)	(369.07)	(116.08)

* Previous periods figures have been regrouped / rearranged wherever necessary

2. REVIEW OF BUSINESS AND OPERATIONS AND STATE OF YOUR COMPANY’S AFFAIRS

Financial Year 2017-18 has been a good year for your Company. On a Macro level digital penetration in the country is expanding rapidly. Low cost smart phones, cheaper data and massive roll out of 4G services have led to millions of new internet users who are exploring various services digitally including Financial Services. Your Company’s positioning of a Low Cost Digital Provider fits perfectly in the evolving Digital Ecosystem. Our approach of keeping Lowest Cost of Service (Rs.10/0rder), Complete Paperless Trading Experience, Multi Product offering under One Umbrella, Usage of Advanced Analytics for personalised financial planning and world class Research & Advisory led to more than 5X growth in our Customer Acquisition. Our Customer acceptability was so good that in no time your company became one of the fastest growing Broking Company in the country.

Mobile has become the preferred platform of transaction for millions of Indians. Your Company is no different. We therefore take utmost interest in making our Mobile platform one of the best in the industry. We are happy to share that 5paisa mobile app is the fastest growing Mobile App in terms of Downloads and have also reached a Milestone of 1 Million Downloads with a Rating of 4 which only 3 other brokers have achieved till date.

During the year, the total income of your Company was up from of Rs.74.67 million to Rs.196.52 million The increase in income is on the back of aggressive expansion of retail Operations. The Company acquired more than 50,000 Customers on the back of value added and unparalleled product offering which helped in growth on Q-0-Q. Your company also invested heavily in Online Marketing, Branding and IT as a result expenses increased from Rs.238.47 million to Rs.528.62 million

During the year, your company got listed on BSE and NSE on November 16, 2017, post successful completion of Demerger process from erstwhile Parent Company i.e. IIFL Holdings Ltd. The demerger process was initiated post capital infusion of Rs.100 Cr. by parent Company in September 2016. In consideration of demerger of 5paisa Digital Undertaking, the existing shareholders of IIFL Holdings Limited on the record date i.e. October 18, 2017 received shares of the Company in the ratio of 1 equity share of the Company for every 25 equity shares of IIFL Holdings Limited held by them.

3. MACRO-ECONOMIC OVERVIEW

Global economy is looking up after a gap of seven years as economic activity remains buoyant across developed and emerging market economies. In its latest world economic outlook edition of April 2018, IMF has revised up GDP growth forecasts of most large economies for CY18 and CY19. It now expects World GDP growth to improve to 3.9% YoY in CY18 and CY19 from 3.8% YoY last year. Unemployment in US has fallen to historic lows and as a result wage growth has accelerated over the last few months. Outlook for Euro area also remains positive on the back of falling unemployment and improving consumer confidence. Also global trade volume has registered strong growth in the past few months.

The outlook for Indian economy also remains optimistic as the economy seems to be finally recovering from the twin shocks of demonetisation and implementation of GST. Most high frequency indicators are suggesting acceleration in growth, even as headline inflation remains benign. Strong growth in domestic air traffic, personal vehicle sales and rise in personal credit growth suggest that urban consumption is on a strong footing. Also drivers for capex cycle recovery are falling in place and we should see gradual increase in private sector capex over the coming quarters. PAT growth, one of the key factors for private sector capex decisions has seen a sharp improvement over last couple of quarters and this growth is likely to sustain. Recent improvement in capacity utilisation is also a positive for capex cycle. Also the overhang of unproductive assets is receding as share of capital work in progress in total assets has come off over last couple of years.

That said, the economy faces multiple risks especially on macro-economic stability that we have achieved in last few years. Rising commodity prices, especially of crude, could widen current account deficit and for the first time in four years, foreign direct investments would not be able to cover the deficit. Dependency on the more volatile foreign portfolio flows to cover the current account deficit would exert pressure on INR. While the decision to hike MSPs to 1.5 times the cost could provide support to rural consumption, it could also lead to acceleration in inflation and derail urban consumption. Also we have elections due in many large states during the course of the year followed by general elections in early next year. The uncertainty around election outcomes could make investors jittery. Investors prefer status quo and any change of government post elections could hurt investor sentiment, at least in the short run.

4. INDUSTRY OVERVIEW

Capital markets have been buoyant and both primary and secondary markets have seen healthy growth in activity over last one year. Corporates raised a record Rs.2 trillion from primary markets via IPOs, QIP, rights issue etc. in CY17. The domestic investors are now a dominant player in equity markets even as foreign portfolio flows have decelerated. Investments in mutual funds via ‘Systematic Investment Plan’ or SIPs have gained significant traction and collections via SIPs have more than doubled in last two years. Driven by rise in domestic investments and optimistic outlook for earnings growth, Indian equity indices hit all-time highs in early 2018.

Buoyant markets have accelerated trading volumes. Average daily cash trading volumes went up ~38% YoY to Rs.338 billion/day in FY18 from Rs.244 billion/day in FY17. Also the share of institutions (FII DII) edged up to 31.9% in FY18 from 29.7% in the previous year. However rise in transaction volumes has been offset by steadily falling yields. Yields have been declining over the past few years due to multiple factors including i) Rise of passive investment, ii) Rising participation of domestic funds that have lower yields and iii) the European and UK regulators have introduced Markets in Financial Instruments Directive or Mifid II norms from January 2018 and under these norms investors need to separately account for execution and research instead of the bundled cost model followed so far.

5. SCHEME OF ARRANGEMENT (DEMERGER OF 5PAISA DIGITAL UNDERTAKING)

During the year under review, the Hon’ble National Company Law Tribunal, Mumbai bench had vide order dated September 06, 2017 sanctioned the Scheme of Arrangement between IIFL Holdings Limited (‘Demerged Company’) and 5paisa Capital Limited, the (‘Resulting Company’) and their respective Shareholders (“the Scheme”). The Scheme inter alia provided for Demerger of 5paisa digital undertaking business from IIFL Holdings Limited to 5paisa Capital Limited. The effective date of the demerger was October 01, 2016.

Upon the Scheme coming into effect and in consideration of the transfer and vesting of the 5paisa digital Undertaking into the Company, 17,716,500 Equity Shares of Rs.10 each held by IIFL Holdings Limited in the Company were extinguished and cancelled and in lieu of the same, the equity shareholders of IIFL Holdings Limited whose name appeared in the Register of Members on October 18, 2017 were allotted one (1) equity share in 5paisa Capital Limited of Rs.10/- each credited as fully paid-up for every Twenty Five (25) equity share of Rs.2/- each fully paid-up held by such equity shareholders in IIFL Holdings Limited. Accordingly, 12,739,022 equity shares of Rs.10/- each of the Company were issued and allotted to the Eligible Shareholders of IIFL Holdings Limited on October 20, 2017. The equity shares of the Company so issued pursuant to the Scheme were listed and admitted for trading on BSE Limited (“BSE”) and National Stock Exchange of India Limited (“NSE”) with effect from November 16, 2017.

As per the Scheme, the Company transferred the assets and liabilities pertaining to demerged undertaking (5paisa digital Undertaking) at the respective carrying values as appearing in the books of accounts of IIFL Holdings Limited on October 01, 2016. The difference between the value of the assets and liabilities pertaining to demerged undertaking amounting to Rs.47,709,974 (after adjusting for the amount to the share capital) has been recognised as Capital Reserve in the books of accounts of the Company as on Appointed Date.

6. AWARDS AND RECOGNITIONS

- The Company won “Best Digital Start-up of the Year Award” by World Digital Marketing Congress.

- Your Company stood among Top 10 Brokers in terms of New Active Client and in 2nd position in Discount Broking.

7. DIVIDEND

In view of accumulated losses, your Directors have not recommended any dividend on Equity Shares for the year under review.

8. SHARE CAPITAL

During the year under review and in terms of aforesaid Scheme of Arrangement, 17,716,500 Equity Shares of Rs.10 each held by IIFL Holdings Limited in the Company were extinguished and cancelled and in lieu of the same, the Company allotted fresh 12,739,022 equity shares of Rs.10 each to the eligible shareholders whose name appeared in the Register of Members on October 18, 2017. The paid up equity share capital of the Company as on March 31, 2018 was Rs.127,390,220/- (12,739,022 equity shares of Rs.10/each).

9. EMPLOYEES STOCK OPTION SCHEMES (ESOS)

During the year under review, the shareholders of the Company have approved two (2) Esop scheme(s) having a pool size of 600,000 options each under i.e. 5paisa Capital Limited Employee Stock Option Scheme 2017 and 5paisa Capital Limited Employee Stock Option Trust Scheme 2017. The Nomination and Remuneration Committee granted 220,000 options on January 29, 2018 to the eligible employees of the Company under 5paisa Capital Limited Employee Stock Options Scheme 2017.

There is no material change in Employees’ Stock Option Scheme during the year under review and the Scheme is in line with the SEBI (Share Based Employee Benefits) Regulations, 2014 (“SBEB Regulations”). The Company has received a certificate from the Auditors of the Company that the Scheme has been implemented in accordance with the SBEB Regulations and the resolution passed by the members. The certificate would be placed at the Annual General Meeting for inspection by members. The disclosures relating to ESOPs required to be made under the provisions of the Companies Act, 2013 and the rules made thereunder and the SEBI (Share Based Employee Benefits) Regulations, 2014 are provided on the website of the Company www.5paisa.com and the same is available for inspection by the members at the Registered Office of the Company during the business hours on working days except on Saturdays, Sundays and Public Holidays, up to the date of the Meeting. If any member is interested in obtaining a copy thereof, such member may write to the Company Secretary, whereupon a copy would be sent.

10. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Loans, Guarantees and Investments covered under the provisions of the Section 186 of the Companies Act, 2013 forms part of the notes to the financial statements provided in this Annual Report.

11. SUBSIDIARY COMPANY

During the year under review, the Company incorporated, a wholly owned subsidiary namely 5paisa P2P Limited on December 07, 2017. The 5paisa P2P Limited has filed the application with the Reserve Bank of India for obtaining the registration for Peer to Peer Lending and the approval is awaited.

As per the provisions of section 134 and 136 of the Companies Act, 2013 read with applicable Rules, Regulation 33 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and applicable Accounting Standards, the Board of Directors had at their meeting held on April 17, 2018 approved the consolidated financials of the Company along with the Standalone financial statements. Copies of the Balance Sheet, Statement of Profit and Loss Account, Report of the Board of Directors and Report of the Auditors of the subsidiary Company are not attached to the accounts of the Company for the financial year 2017-18. The Company will make these documents/details available upon request by any member of the Company. These documents/details will also be available for inspection by any member of the Company at its registered office and at the registered offices of the concerned subsidiary during the business hours on working days i.e. except on Saturdays, Sundays and Public Holidays. If any member is interested in obtaining a copy thereof, such member may write to the Company Secretary, whereupon a copy would be sent. The Annual Report of subsidiary will be uploaded on the website of the Company. As required by the Companies Act, 2013 and Accounting Standard - 21 (AS 21) issued by the Institute of Chartered Accountants of India, the Company’s consolidated financial statements included in this Annual Report incorporate the accounts of its subsidiary. A report on the performance and financial position of the subsidiaries is provided in the prescribed form AOC-1 as “Annexure I”, which forms part of this Report.

The policy on determining the material subsidiary is available on the website of the Company at www.5paisa.com.

12. MANAGEMENT DISCUSSION AND ANALYSIS REPORT

In accordance with Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Management Discussion and Analysis Report forms part of this report.

13. DIRECTORS AND KEY MANAGERIAL PERSONNEL

a. Directors:

The Board comprises of Mr. Prakarsh Gagdani and Mr. Santosh Jayaram as the Executive Directors, Dr. Archana Niranjan Hingorani and Ms. Nirali Sanghi as the Independent Directors of the Company.

Appointment

Mr. Santosh Jayaram was appointed as Additional Director and was further designated as Whole Time Director for the period of 3 years, subject to approval of the Shareholders w.e.f. January 11, 2018. Ms. Nirali Sanghi was appointed as an additional Director and was designated as an Independent Director subject to approval of the Shareholders w.e.f. January 11, 2018. She holds office as per her tenure of appointment mentioned in the Notice of the ensuing Annual General Meeting of the Company.

Confirmation

I. Mr. Krishna Iyer was confirmed as the Independent Director by the Shareholders of the Company in the 10th Annual General Meeting held on July 19, 2017 for a period of five years w.e.f. March 31, 2017.

II. Dr. Archana Niranjan Hingorani was confirmed as the Independent Director by the Shareholders of the Company in the 10th Annual General Meeting held on July 19, 2017 for a period of five years w.e.f. June 07, 2017.

Resignation

Mr. Mohan Radhakrishnan and Mr. Narendra Jain, the Non-Executive Directors and Mr. Krishna Iyer, the Independent Director resigned w.e.f. January 11, 2018 due to their pre occupation.

Declaration by Independent Directors

The terms and conditions of appointment of Independent Directors are as per Schedule IV of the Act. The Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of independence as prescribed under sub-section (6) of Section 149 of the Companies Act, 2013 as well as under the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 (“SEBI Listing Regulations”) and there has been no change in the circumstances which may affect their status as independent director during the year.

Retirement by Rotation

In accordance with Section 152 of the Companies Act, 2013 (“Act”) read with Article 157 of the Articles of Association of the Company, Mr. Prakarsh Gagdani is liable to retire by rotation at the ensuing Annual General Meeting and being eligible has offered himself for reappointment. The Board recommends the same for shareholders’ approval.

Re-appointment of Whole Time Director

The tenure of Mr. Prakarsh Gagdani as the Whole Time Director ends on December 21, 2018 and the Board recommends his re-appointment to Shareholders in the ensuing Annual General Meeting. The terms and conditions of the re-appointment are mentioned in the Notice of the ensuing Annual General Meeting of the Company.

b. Key Managerial Personnel:

As on March 31, 2018, Mr. Prakarsh Gagdani - Whole Time Director & Chief Executive Officer, Mr. Santosh Jayaram - Whole Time Director, Mr. Roshan Dave - Company Secretary & Compliance Officer and Ms. Ankita Lakhotia - Chief Financial Officer are the Key Managerial Personnel as per the provisions of the Companies Act, 2013 and rules made thereunder.

During the year under review,

Mr. Prakarsh Gagdani, Whole Time Director was also designated as Chief Executive officer of the Company w.e.f. January 11, 2018 and Mr. Santosh Jayaram was appointed as Additional Director and further designated as Whole Time Director subject to approval of the Shareholders w.e.f. January 11, 2018.

Mr. Harshit Choudhary was appointed as a Company Secretary and Compliance Officer in place of Mr. Jayesh Sharma w.e.f. October 13, 2017. Mr. Harshit Choudhary, Company Secretary & Compliance Officer, resigned w.e.f. January 31, 2018 and in his place Mr. Roshan Dave was appointed as the Company Secretary & Compliance Officer of the Company w.e.f. February 01, 2018. These changes in the Key Managerial Personnel were due to internal re-structuring.

The Remuneration and other details of the Key Managerial Personnel for the year ended March 31, 2018 are mentioned in the Extract to the Annual Return in Form MGT-9 which is attached as “Annexure II” and forms a part of this report of the Directors.

14. MEETING OF DIRECTORS & COMMITTEE/BOARD EFFECTIVENESS

- Meetings of the Board of Directors

The Board met Five (5) times during the year to discuss and approve various matters including financials, appointment of auditor, review of audit reports and other board businesses. For further details please refer to the report on Corporate Governance.

- Committees of the Board

In accordance with the applicable provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board constituted the following Committees:

- Audit Committee

- Nomination and Remuneration Committee

- Stakeholders Relationship Committee

- Audit Committee:

During the year, the Audit Committee met Five (5) times. In compliance with the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Companies Act, 2013, during the year, the Company has re-constituted the Audit Committee and details thereof have been provided in Corporate Governance Report. At present the Committee comprises of Dr. Archana Niranjan Hingorani as the Chairman, Ms. Nirali Sanghi and Mr. Prakash Gagdani as the Members of the Audit Committee.

The role, terms of reference and powers of the Audit Committee are in conformity with the requirements of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Committee met during the year under review and discussed on various matters including financials, audit reports and appointment of auditors. During the period under review, the Board of Directors of the Company accepted all the recommendations of the Audit Committee.

The terms of reference of Audit Committee and details of Committee meeting are provided in the Corporate Governance Report.

- Nomination and Remuneration Committee

During the year, the Nomination and Remuneration Committee met Four (4) times. The Company re-constituted the Nomination and Remuneration Committee and details thereof have been provided in Corporate Governance Report. At present, the Committee comprises of Ms. Nirali Sanghi as the Chairman and Dr. Archana Niranjan Hingorani and Mr. Prakarsh Gagdani as members of the Committee. Pursuant to the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Companies Act, 2013, the Company is in process of appointing one more Non-Executive Director/ Independent Director who will also be nominated to Nomination Remuneration Committee.

The role, terms of reference and powers of the Nomination and Remuneration Committee are in conformity with the requirements of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the same has been provided in the Corporate Governance Report.

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a Nomination and Remuneration policy in compliance with the aforesaid provisions for selection and appointment of Directors, KMP, senior management personnel of the Company. The said policy is stated in the Corporate Governance Report of the Company. The details of Committee meeting are provided in the Corporate Governance Report.

- Stakeholders Relationship Committee

During the year, the Stakeholders Relationship Committee met One (1) time. In compliance with the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Companies Act, 2013, the Company has re-constituted a Stakeholders Relationship Committee and details thereof have been provided in Corporate Governance Report. The Committee comprises of Ms. Nirali Sanghi as the Chairman, Dr. Archana Niranjan Hingorani and Mr. Prakarsh Gagdani as the members of the Committee.

The role, terms of reference of the Stakeholders Relationship Committee are in conformity with the requirements of the Companies Act, 2013 and Regulation 20 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the same has been provided in the Corporate Governance Report.

No complaints has been received from SEBI scores portal during the Financial Year 2017-18. The details of the Meeting are given in the Corporate Governance Report.

- Board Effectiveness

- Familiarisation Program for the Independent Directors

In compliance with the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has put in place a Familiarisation Programme for Independent Directors to familiarise them with the working of the Company, their roles, rights and responsibilities vis-a-vis the Company, the industry in which the Company operates business model etc. Details of the Familiarisation Programme are explained in the Corporate Governance Report and are also available on the Company’s website at http://www.5paisa.com.

- Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and SEBI Circular no SEBI/CFD/CMD/CIR/P/2017/004 dated January 05, 2017, the Board of Directors has carried out an annual performance evaluation of its own performance, the Directors individually including Independent Directors based out of the criteria and framework adopted by the Board. The Board approved the evaluation results as collated by Nomination and Remuneration Committee (“NRC”). The evaluation process, manner and performance criteria for independent directors in which the evaluation has been carried out by is explained in the Corporate Governance Report.

The Board considered and discussed the inputs received from the Directors. Also, the Independent Directors at their meeting held on March 29, 2018 reviewed the following:

- Performance of Non-Independent Directors and the Board as a whole

- Performance of the Chairperson of the Company.

- Assessed the quality, quantity and timeliness of flow of information between the Company’s management and the Board, which is necessary for the Board to effectively and reasonably perform their duties.

The Independent Directors expressed their satisfaction with overall functioning and implementations of their suggestions.

The evaluation process endorsed the Board Members’ confidence in the ethical standards of the Company, the cohesiveness that exists amongst the Board Members, the two-way candid communication between the Board and the Management and the openness of the Management in sharing strategic information to enable Board Members to discharge their responsibilities.

15. DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134(5) of the Companies Act, 2013, it is hereby confirmed that:

a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

b) the directors had 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 at the end of the financial year and of the profit of the Company for that period;

c) the directors had taken proper and sufficient care 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;

d) the directors had prepared the annual accounts on a going concern basis;

e) the Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

f) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

16. INTERNAL FINANCIAL CONTROLS

The Company has in place adequate internal controls with reference to financial statements and operations and the same are operating effectively. The Internal Auditors tested the design and effectiveness of the key controls and no material weaknesses were observed in their examination. Further, Statutory Auditors verified the systems and processes and confirmed that the Internal Financial Controls system over financial reporting are adequate and such controls are operating effectively.

17. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

The Company has put in place a policy for Related Party Transactions (RPT Policy), which has been approved by the Board of Directors. The policy provides for identification of RPTs, necessary approvals by the Audit Committee/Board/ Shareholders, reporting and disclosure requirements in compliance with Companies Act, 2013 and provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

All contracts executed by the Company during the financial year with related parties were on arm’s length basis and in the ordinary course of business. All such Related Party Transactions were placed before the Audit Committee/ Board for approval, wherever applicable.

During the year, the Company has entered into any contract / arrangement / transaction with related parties, which considered as material in accordance with Regulation 23 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the same was also approved by the shareholders via postal ballot on January 25, 2018. The policy for determining ‘material’ subsidiaries and the policy on materiality of Related Party Transactions and dealing with Related Party Transactions as approved by the Board may be accessed on the Company’s website www.5paisa. com. You may refer to Note no. 26 to the financial statement, which contains related party disclosures.

The Company had not entered into any material contracts or arrangements or transactions under sub-section (1) of section 188 of the Act. Hence, Form AOC-2 disclosure is not required to be provided.

18. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return of the Company in form MGT - 9 is annexed herewith as “Annexure - II”.

19. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

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 and the date of this annual report.

20. SECRETARIAL AUDIT

The Board had appointed M/s. Nilesh Shah & Associates, Practicing Company Secretaries to conduct Secretarial Audit of the Company for the year 2017-18. The Auditor had conducted the audit and their report thereon was placed before the Board. The Auditor in their report stated that the Nomination and Remuneration Committee consist of 3 members i.e. 2 Independent Director and 1 Executive Director w.e.f. January 11, 2018. As informed by the management, the Company is in process of appointing one more Non-Executive Director/Independent Director who will also be nominated to Nomination and Remuneration Committee. The said noting is self-explanatory. The report of the Secretarial Auditor is annexed herewith as “Annexure -III”.

21. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The additional information on energy conservation, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is appended as “Annexure -IV” to and forms part of this Report.

22. RISK MANAGEMENT

Your directors, on a regular basis, (a) oversee and approve the Company’s enterprise wide risk management framework; and (b) oversee that all the risks that the organisation faces such as strategic, financial, credit, market, liquidity, security, property, IT, legal, regulatory, reputational and other risks have been identified and assessed and there is an adequate risk management infrastructure in place capable of addressing those risks. Your Company has in place various policies and procedures covering the business, operations, employees, finance & accounting, customer services which are approved by the Board.

Your Company has in place specialised internal audits on Broking and Depository Participant business as per the SEBI / Exchanges/ Depositories norms. The findings on Audit Reports are reviewed by the Audit Committee / Board at their periodical meetings and the reports are submitted to the Exchanges /Depositories.

Your Company’s management monitors and reports on the principal risks and uncertainties that can impact its ability to achieve its strategic objectives.

The Company’s management systems, organisational structures, processes, standards and code of conduct together form the risk management governance system of the Company and management of associated risks.

23. WHISTLE BLOWER POLICY/ VIGIL MECHANISM

In compliance of the Companies Act, 2013 and Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has adopted a Whistle Blower Policy and has established the necessary vigil mechanism for Directors, Employees and Stakeholders to report genuine concerns about unethical behaviour, actual or suspected fraud or violation of the Company’s code of conduct or ethics policy. The Company has disclosed the policy at the website at https://www.5paisa.com.

24. PREVENTION OF SEXUAL HARASSMENT

Your Company recognises its responsibility and continues to provide a safe working environment for women, free from sexual harassment and discrimination. In Compliance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has put in place a Policy on prevention of Sexual Harassment of Women at workplace.

Your Directors further state that the during the fiscal year 2017-18, there were no complaints pending pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The following is reported pursuant to Section 22 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013:

a) Number of complaints received in the year : 1

b) Number of complaints disposed off during the year : 1

c) Number of cases pending more than ninety days: Nil

d) Number of workshops or awareness programme against sexual harassment carried out:

The Company has conducted an online training for creating awareness against the sexual harassment against the women at work place.

e) Nature of action taken by the employer or district officer: The Company has taken the appropriate action on the said matter.

25. PARTICULARS OF EMPLOYEES

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in “Annexure - V”.

Further, a statement showing the names and other particulars of employees drawing remuneration in excess of the limits as set out in the Rules 5(2) and 5(3) of the aforesaid Rules, forms part of this report. However, in terms of first proviso to Section 136(1) of the Act, the Annual Report and Accounts are being sent to the members and others entitled thereto, excluding the aforesaid information. The said information is available for inspection by any member of the Company at its registered office and at the registered offices of the subsidiary during the business hours on working days except on Saturdays, Sundays and Public Holidays. If any member is interested in obtaining a copy thereof, such member may write to the Company Secretary, whereupon a copy would be sent.

26. STATUTORY AUDITORS

Pursuant to the provisions of Section 139(2) of the Companies Act, 2013 (“Act”) and the rules made thereunder, the members at their 10th Annual General Meeting (“AGM”) held on July 19, 2017, had appointed M/s. V Sankar Aiyar & Co., Chartered Accountants, Mumbai (Firm Registration Number: 109208W) as Statutory Auditor for a period of five years i.e. from the conclusion of 10th AGM till the conclusion of 15th AGM of the Company to be held in the year 2022 subject to ratification of their appointment at every AGM. Accordingly, the appointment of M/s. V Sankar Aiyar & Co., Chartered Accountants as Statutory Auditors of the Company is placed for ratification by the Members in the forthcoming AGM.

In this regard, the Company has received a certificate from the Statutory Auditors to the effect that ratification of their appointment, if made, would be in accordance with the provisions of Section 141 of the Act. They have also confirmed that they hold a valid Peer Review Certificate issued to them by the Institute of Chartered Accountants of India (“ICAI”).

27. REPORTING OF FRAUDS BY AUDITORS

During the year under review, the Statutory Auditors and the Secretarial Auditor have not reported any instances of frauds committed in the Company by its Officers or Employees to the Audit Committee under section 143(12) of the Companies Act, 2013, details of which needs to be mentioned in this Report.

28. CORPORATE GOVERNANCE

The Company is committed to maintain the highest standards of Corporate Governance and adhere to the Corporate Governance requirements set out by SEBI. The report on Corporate Governance as stipulated under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms an integral part of this Report. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance is attached to the report on Corporate Governance.

29. GENERAL

Your Directors state that during the financial year 2017-18:

1. The Company did not accept/renew any deposits within the meaning of Section 73 of the Companies Act, 2013 and the rules made there under and as such, no amount of principal or interest was outstanding as on the balance-sheet date.

2. The Company has not issued equity shares with differential rights as to dividend, voting or otherwise.

3. The Company has not issued any sweat equity shares during the year.

4. There are no significant and material orders passed against the Company by the Regulators or Courts or Tribunals, which would impact the going concern status of the Company and its future operations.

30. APPRECIATION

Your Directors place on record their sincere appreciation for the assistance and guidance provided by the Government, Regulators, Stock Exchanges, Depositories, other statutory bodies and Company’s Bankers for the assistance, cooperation and encouragement extended to the Company.

Your 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. Our employees are instrumental in the Company to scale new heights, year after year. Their commitment and contribution is deeply acknowledged. Your involvement as shareholders is also greatly valued. Your Directors look forward to your continuing support.

For and on behalf of the Board

Prakarsh Gagdani Santosh Jayaram

Whole Time Director & CEO Whole Time Director

(DIN: 07376258) (DIN: 07955607)

Date: April 17, 2018

Place: Mumbai